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No. 11658 


Anited States 
Circuit Court of Appeals 


Hor the Minth Circuit. 


GLENS FALLS INDEMNITY COMPANY, a 
Corporation, 
Appellant, 
VS. 


BASICH BROTHERS CONSTRUCTION COM- 
PANY, a Corporation, 
Appellee. 


Transcript of Wecord 


In Two Volumes © 
Volume I rp) Ody 
Pages 1 to 4382 


PAUL. P, ia 
wm ~OLERK 
Upon Appeal from the District Court of the United Ses 
for the Southern District of California 
Central Division 


Rotary Colorprint, 870 Brannan Street, San Francisco 8-15-47—60 


No. 11658 


Gnited States 
Circuit Court of Appeals 


For the Ninth Circuit. 


GLENS FALLS INDEMNITY COMPANY, a 


Corporation, 
Appellant, 
VS. 


BASICH BROTHERS CONSTRUCTION COM- 


PANY, a Corporation, 
Appellee. 


Transcript of Record 


In Two Volumes 
Volume I 
Pages 1 to 432 


Upon Appeal from the District Court of the United States 
for the Southern District of California 
Central Division 


Rotary Colorprint, 870 Brannan Street, San Francisco 8-15-47—60 


hi Glens Falls Indemnity Co. vs. 


INDEX PAGE 


Bill of Particulars—(Continued) : 


ViI—Equipment Rental Fully Op- 
erated 2/12/45 to 5/19/45 .. 
VITi—Equipment Rental Not Fully 
Operated 3/29/45 to 6/9/45 
TX—Equipment Rental Royalty 


X—Equipment Rental Fully Op- 
erated 2/12/45 to 5/19/45. 
Not Fully Operated 5/9/45 
t0 6/10/49 ....2es. . ee 


XI—Equipment Rental Fully Op- 
erated by Basich Bros. 

2/21/45 10 6/6/45 .... 
XII—Equipment Rental Fully Op- 
erated 4/6/45 to 4/24/45 ... 
XTI—Equipment Rental Not Fully 
Operated 4/24/45 to 6/9/45 
XILV—Equipment Rental Not Fully 
Operated 4/6/45 to 5/8/45 . 
XV—Equipment Rental Fully Op- 
erated 6/9/45 to 9/16/45 .. 
XVI—Equipment Rental Not Fully 
Operated 6/9/45 to 9/8/45 . 
XVII—Equipment Rental Royalty 
Basis...) ape ace 


XVIII—Equipment Rental Not Fully 
Operated 6/15/45 to 9/17/45 


09 


61 


62 


62 


66 


68 


68 


69 


69 


69 


69 


70 


Basich Brothers Construction Co. ili 
INDEX PAGE 
Bill of Particulars—(Continued) : 
XIX—Equipment Fully Operated 


679745 10:9/6/45 .......... 70 
XX—Equipment Rental Royalty 
IORI ile in a 70 


XXJ—Equipment Rental Fully Op- 
erated 6/8/45 to 9/12/45 .. 70 


XXII—Equipment Rental Fully Op- 
erated 6/15/45 to 8/9/45 .. 70 


X XITI—Equipment Rental Not Fully 
Operated 6/9/45 to 9/10/45 70 


XXIV—Equipment Rental Not Fully 
Operated 6/15/45 to 9/8/45 71 


XXV—Equipment Rental Not Fully 
Operated 7/6/45 to 9/17/45 71 

XXVI—Repairs Made by Others on 
IB elon Mei bee ee 2 ki 71 

XXVII—Parts Purchased for Equip- 


ment Not Fully Operated 
2/14/45 to 6/4/45 ......... 71 


SOV Parts Taken from Stock ..... ne 


XXIX—Fuel, Grease, Oil on Equip- 
ment Not Fully Operated 
4/9/45 to 5/31/45 ......... We 


XX X—Miscellaneous Labor, Invoices, 
etc., 2/26/45 to 6/16/45 .... 72 


iv Glens Falls Indemnity Co. vs. 


INDEX PAGE 


Bill of Particulars—(Continued) : 
XX XI—Freight on Rented Equipment 
XX XII—Repairs Made by Others on 
Equipment Not Fully Op- 
erated 6/9/45 to 9/10/45 ... 
XXXITI—Parts Purchased for Equip- 
ment Not Fully Operated 
6/16/45 to 9/19/45 .. ae 
XXXIV—Parts Taken from Stock .... 
XXXV—Fuel, Grease and Oil on 


Equipment Not Fully Op- 

erated 6/7/45 to 9/6/45 ... 

XXX VI—Miscellaneous Labor, Invoices, 
ete., 6/7/45 to 9/17/45 ..... 

XXX VII—Freight on Rented Equipment 
XXX VIII—Production Gravel Base ..... 
XX X{[X—Preduction Gravel Stabilized 
Bas@ 444 46602 

XXX X—Production Gravel HEmbank- 
ment ..:taee ee eee 

XXX XI—Production Conerete Aggre- 
gale .....) eee ee 

XXX XII—Production Mineral Aggre- 
cate .... dence eee 

XXX XUI—Production Concrete Aggre- 
wate forsStriemimlcs: .... 3). 
XLIV—Miscellaneous Credits ....... 


74: 


74 


(6) 


79 


5) 


79 
78 


a on 


79 


80 


80 


81 


Basich Brothers Construction Co. o 


INDEX PAGE 
Memmmngite Of Cleme 2.5 oe. ck ce ci ewes vez 
Complaint for Recovery of Money and on Bond 2 

Exhibit A—Subecontract Agreement ..... 17 
Exhibit B—Subeontract Bond .......... ay 


Decision and Order for Judgment and Find- 
AT MME os. 5 a eng ys ci vce owe Naess. 186 


Exhibits, Defendant: 
A—Letter of 5/3/45 to Duque & Frazzini 
in Answer to Letter of 5/1/45 ..... 876 
B—Confirmation of Verbal Agreement 
Between Mr. N. L. Basich and 
MCG rwe Ay ZIM — ad ee. ae oe 877 
C—Reeapitulation of Production Items 
Mentioned in Article X XIII of the 
Subcontract Dated 2/7/45 ........ 878 
D—Schedule of Payments Made bv Basich 
Bros. on Behalf of Duque & Frazzini 
Py MAO NOC o/ 1/40... 5s 2a nesses 879 


Exhibits, Defendant’s, Attached to Kovick 
Deposition : 
A—Letter of 5/12/45 to Duque & Frazzini 582 
B—Letter of 5/12/45 to Duque & Frazzini 583 


Exhibits, Plaintiff’s: 
No. 1—Subcontract Agreement (Set Out 
as Exhibit A, Attached to Complaint for 
ieceovciv on Eace 17) .....:.+ ee 461 
No. 2—Subcontract Bond (Set Out as 
Exhibit B, Attached to Complaint for 
ac over OleleaeC 2)... ic. scan eess: 461 


V1 


Glens Falls Indemnity Co. vs. 


INDEX PAGE 
Exhibits, Plaintiff’s— (Continued) : 


No. 3—Letter to Basich Bros. Co. 3/7/45 
No. + Letter to Duque & Frazzini 4/5/45 
No. 5—Letter to Duque & Frazzini 
EPOT AD occ ev in vo pee 
No. 6—Letter to Mr. Monteleone 5/8/45 . 
No. %—Letter to Mr. J. KE. MeCall 5/15/45 
No. 8—Letter to Duque & Frazzini 
CCB 3 rR 
No. 9—Letter to Duque & Frazzini 
D/DAVAIN, ois vaca ane 
No. 10—Letter to Duque & Frazzini 6/1/45 
No. 11—Letter to Basich Bros. Co. 6/7/45 
No. 12—Letter to Duque & Frazzini 6/8/45 
and Attached Letter from War Dept. 
U.S. Engineer Office 6/7/45 .......... 
No. 13—Letter to Duque & Frazzini 6/9/45 
No. 14—Letter to Glens Falls Ind. Co. 
G/N) .... 0.02 ee 
No. 15—Letter to Mr. John E. McCall 
GA 4D oe. ids eee 


No. 16—Letter to Glens Falls Ind. Co. 
O/AY4AD 2. eects Oe 


No. 17—Letter to Basich Bros., Co. 6/23/45 
No. 18—Letter to Mr. John E. McCall 
29/45 ccs Ee 


462 
463 


464 
467 
469 


471 


474 


477 
479 


482 
491 


No. 19—Workmen’s Compensation Policy 507 


No. 20—Construction Contract War De- 
partment, Form No, 208). 72) 


Basich Brothers Construction Co. Vil 


INDEX PAGE 
Exhibits, Plaintiff’s—(Continued) : 


No. 21—Stipulation to Take Deposition of 


infigle ibe LE SC Aaa, a a D06 
Deposition of Nick I, Basich......... 008 

No. 22—Stipulation to Take Deposition of 
Geourem = Wowie. (235.2 gee eo ek 611 
Deposition of George W. Kovick..... 613 
SOMO CESS 5 ores ares arachin em diarti a 614 
meee MUS SIOACT ore sr aes cad cheep 668 
SSRECICEL Se ide cc Be ve ws Oe. (0s, OT 
= HECTOSSss vais eae heck Vea 673, 675, 679 

No. 23—Deposition of John H. Bray, Wit- 
TOSS, PGW (Nts Ai ers 684 
No. 24—Deposition of Carson Frazzini .. 754 
—=(INQGU. Bay see 756 
CRORE ee a. 843 
—ireceGls ce ¢ oo a ene eae ee ea 866 
Findings of Fact and Conclusions of Law .... 193 
@omelsions of Waw .........0seeee cece es 211 
Mitotic On MCh. 2626s e eee ye ee es 194 


First Amended Answer of Defendant Glens 
Falls Indemnity Company, a Corporation .. 89 
Exhibit No. 1—Registered Letter 4/5/45 . 116 

Exhibit No. 2—Letter to Duque & Fraz- 
ZUM MO AOE ess se SOR 117 


JUCEIMEMN 52 ols CRB e es ee. oie 


Letter Dated 10/8/46 from J. E. McCall to Mr. 
Swepmem Monteleone ..........-.--..+..... 25 


Vill Glens Falls Indemnity Co. vs. 


INDEX PAGE 
Memorandum Answering Letter of 10/8/46 ... 127 


Memorandum of Defendant Glens Falls In- 
demnity Company, a Corporation, Re Plain- 


tiff’s Bill of Particulars .......... 3 146 
Names and Addresses of Attorneys ... 77am 1 
Notice of Perea Leese i dibegs o¢566 215 
Notice to Produce ...........3.... == 84 
Request for Admission Under Rule 36 ....38 86 


Reporter’s Transcript of Pre-Trial Hearing .. 224 


Reporter’s Transcript of Proceedings: 


Oct. 14, 1946, Judge Hall ........ 33am 243 
Nov. 7, 1946, Judge Yankwich ....\ 33a 290 
Nov. 25, 1946. Judge Yankwich .......°9 280 
Feb. 4, 1947, Judge Yankwich............ 312 


Feb. 5, 1947, Judge Yankwich (Partial) .. 440 
Statement of Points on Which Appellant In- 


fends to Rely .........45.560 98. =e 215 
Statement of Points on Which Appellant In- 

tends to Rely on Appeal .. 22322.) ... ae 880 
Stipulation and Orde ............ .. -= ae Zell 


Stipulation—Defendant May File Amended 
AVSIWET 2.00. ce oe oe eee 88 


Stipulation (Unsigned) Filed 10/14/46 ...... 1s 


Baswoh Brothers Construction Co. 


INDEX 
Witness, Defendant: 


Vernon, Lawrence H. 
ZU IORSO aoe ee 
== CROSS: SUeeies seen ee ee 


Witnesses, Plaintiff: 


Basich, Nickola L. 
—direct 


Popovich, George J. 
SORTS 2 eee aace 2s. swab ele 6 do acetates 
=—=GTONS ae utes oe ee eee 


Woolums, Bart C. 
=O RAH ie i os A 
—=CORS soe: 0 


NAMES AND ADDRESSES OF ATTORNEYS 


For Appellant: 
JOHN E. McCALL, 
JOSEPH J. BURRIS, 
458 8. Spring St., 
Los Angeles 18, Calif. 


For Appellee: 
STEPHEN MONTELEONE, 
TRACY J. PRIEST, 
714 West Olympic Bldg., 
Los Angeles 15, Calif. 


2 Glens Falls Indemnity Co. vs. 


In the District Court of the United States, Southern 
District of California, Central Division. 


No. 5021-PH Civ. 


BASICH BROTHERS CONSTRUCTION 
COMPANY, a corporation, 
Plaintiff, 
VS. 


GLENS FALLS INDEMNITY COMPANY, a 
corporation, and ANDREW DUQUE and 
CARSON FRAZZINI, co-partners doing busi- 
ness under the name of DUQUE & FRAZZINIT, 

Defendants. 


COMPLAINT FOR RECOVERY OF MONEY 
AND ON BOND 


Comes now the plaintiff herein and, for cause of 
action against said defendants, and each of them, 
complains and alleges: 


Jt. 


That plaintiff, Basich Brothers Construction 
Company now is and, at all times herein mentioned 
was, a corporation of the State of California and 
organized and existing under and by virtue of the 
laws of said state with its principal place of busi- 
ness in the City of Alhambra, County of Los Ange- 
les, State [2*] of California; that it was, at all 


* Page numbering appearing at foot of page of original certified 
Transcript of Record. 


Basich Brothers Construction Co. 3 


times herein mentioned and now is a citizen and 
resident of the State of California. 


ie 


That the defendant, Glens Falls Indemnity Com- 
pany, at all times herein mentioned, has been and 
now is a corporation duly organized, existing and 
doing business under and by virtue of the laws of 
the State of New York, having its principal place 
of business in the City of Glens Falls, State of New 
York, and authorized to transact a general bonding 
business within the states of California and Ari- 
zona; that it was, at all times herein mentioned and 
now is, a citizen and resident of the State of New 
York. 

ITI. 


That at all times herein mentioned said defend- 
ants Andrew Duque and Carson Frazzini have been 
and now are a co-partnership and have been and 
now are citizens and residents of the State of 
Nevada, with their principal place of business at 
Tonopah, State of Nevada. 


IV. 


That the herein action is between citizens of 
different states and the matter in controversy ex- 
ceeds, exclusive of interest and costs, the: sum or 
value of $4000.00. 

V. 


That on or about the 25th day of January, 1945, 
said plaintiff, Basich Brothers Construction Com- 


4 Glens Falls Indemnity Co. vs. 


pany, a corporation, entered into a certain written 
contract with the United States of America by and 
through the Engineering Department thereof, for 
the furnishing of materials and performing of work 
for the construction of taxiways, warmup and park- 
ing aprons, airfield lighting, drainage facilities and 
water service lines, together with appurtenant facil- 
ities necessary at what is known as Davis-Monthan 
Airfield at or near Tucson, Arizona, said contract 
being known as [3] No. W-04-353 Eng. 1302 and 
having job No. Davis-Monthan E.S.A. 210-6, 210-8 
and 210-9. That a copy of said contract is not at- 
tached hereto for the reason of its voluminous 
character. That said defendants and each of them 
know the contents thereof. 


VE 


That on or about the 7th day of February, 1945, 
said plaintiff, Basich Brothers Construction Com- 
pany, a corporation, and said defendants, Duque & 
Frazzini, a co-partnership, entered into a written 
subcontract for the performance of certain work 
and the furnishing of certain material as set forth 
in said subcontract. That the work to be performed 
and the material to be furnished under said last 
mentioned contract was essential to the perform- 
ance by plaintiff Basich Brothers Construction 
Company, a corporation, of the work required to 
be performed by it under its said contract with the 
United States of America. That a copy of said sub- 
contract between plaintiff and said Duque & Fraz- 
zini is hereto attached, marked Exhibit ‘‘A’’ and 


Basich Brothers Construction Co. 5 


made a part hereof to the same force and effect as 
though set out hereim at length. 


VIL. 


That on or about February 20, 1945, and in con- 
formity with the requirements of Article XXIII 
of said subcontract marked Exhibit ‘‘A’’ and hereto 
attached, defendant Glens Falls Indemnity Com- 
pany, a corporation, for a valuable consideration 
paid to it as a premium, made, executed and de- 
livered to plaintiff within said District of Califor- 
nia, Southern District thereof, Central Division, as 
Surety, and said Duque & Frazzini, as Principal, 
a certain contract bond in the penal sum of $101,- 
745.55 for the faithful performance of the work 
contracted to be done under the terms of said sub- 
contract hereto attached and marked Exhibit ‘‘A’’. 
A copy of said bond is hereto attached and marked 
Exhibit ‘‘B’’ and made a part hereof; that on or 
about [4] March 7, 1945, defendant, Glens Falls 
Indemnity Company, a corporation, modified in 
writing said bond marked Exhibit ‘‘B’’ and hereto 
attached, by adding thereto the following: ‘‘It is 
hereby understood and agreed that the 10 days 
appearing in paragraph ‘‘First’’ 1s changed to 
read ‘‘twenty (20) days.’’ 


VIII. 


That at all times herein mentioned following the 
date of the execution and delivery of said bond by 
defendant Glens Falls Indemnity Company, a cor- 
poration, to plaintiff, Basich Brothers Construc- 


6 Glens Falls Indemnity Co. vs. 


tion Company, a corporation, as aforesaid, said 
bond remained in full force and effect and is still 
in full force and effect, and said plaintiff, at all 
of said times, duly performed, complied with and 
fulfilled all of the comditions and stipulations in 
said bond contained on its part to be performed. 


IX. 


That by the terms of Article XII of said sub- 
contract marked Exhibit ‘‘A’’, it is provided, 
among other things, that said Duque & Frazzini 
would prosecute said work continuously with suff- 
cient workmen and equipment to insure its com- 
pletion, and that plaintiff had the right to compel 
them to move in another plant; it is further pro- 
vided in Article X XI thereof, among other things, 
that said Duque & Frazzini would erect two plants, 
each to produce 800 cubic yards of suitable material 
a day to be used in connection with said govern- 
ment project; that it is further provided in Article 
I thereof, among other things, that the provisions 
of said contract. between plaintiff and the United 
States of America and the plans and specifications 
therein referred to are made a part of said sub- 
contract marked Exhibit ‘‘A’’ and hereto attached, 
and that said Duque & Frazzini would furnish all 
material, supplies and equipment, and perform all 
labor required of them under said subcontract, a 
copy of which is hereto attached and marked Ex- 
ibit “‘A’’, to the satisfaction of the Government’s 
Engineer or other authorized representative of the 
Government in charge of said project. It is therein 


Basich Brothers Construction Co. 7 


further provided in Article II thereof, that the 
work shall be commenced not later than February 
19, 1945, and shall be completed on or before June 
3, 1945. That by the provisions of Article XXV of 
said subcontract between plaintiff and said Duque & 
Frazzini, time is expressly made of the essence 
thereof. 
x 


That said Duque & Frazzini entered upon the 
performance of the requirements of their said sub- 
contract with plaintiff, a copy of which is hereto 
attached and marked Exhibit ‘‘A’’, but failed to 
prosecute said work therein required of them con- 
tinuously with sufficient workmen and/or equip- 
ment, or to erect two plants each capable of pro- 
ducing 800 cubie yards of suitable material a day. 
That after commencing work under said contract 
and, on or about April 5, 1945, said Duque & Fraz- 
zini failed to have or thereafter to maintain suff- 
cient workmen and/or sufficient equipment, as in 
said subcontract marked Exhibit “‘A’’ and hereto 
attached required of them. 


XI. 


That said Duque & Frazzini and/or said Glens 
Falls Indemnity Company, after said Duque & 
Frazzini commenced work, as aforesaid, failed and 
neglected to pay labor, equipment. and material 
bills on account of labor performed and/or mate- 
rials and/or equipment furnished to them ‘in’ con- 
nection with the performance of their said sub- 


8 Glens Falls Indemnity Co. vs. 


contract with plaintiff, and failed to faithfully per- 
form the work and requirements contracted to be 
done, as aforesaid. That on account of the failure 
of said Duque & Frazzini to perform faithfully the 
work contracted to be done as hereinbefore more 
specifically set forth, plaintiff did, under date of 
April. 5, 1945, by registered mail, notify said de- 
fendants and each of them, that the plant of said 
Duque & Frazzini [6] was not producing 800 cubic 
yards of suitable material as required by said sub- 
contract, and that they move in additional equip- 
ment to insure proper completion of their said sub- 
COMUract 
Done 


That said defendants Duque & Frazzini, there- 
after continued to work under the said subcontract 
with plaintiff, and as plaintiff is informed and be- 
lieves and upon such information and belief alleges, 
the defendant, Glens Falls Indemnity Company, at 
all times herein mentioned, through its duly author- 
ized agents and representatives, fully investigated 
the facts and conditions relative to the default as 
herein alleged, of said Duque & Frazzini under the 
terms of the aforesaid subcontract with plaintiff 
and said contract bond, and was thereby fully ad- 
vised of all of the facts thereto pertaining. 


GURL 


That on or about April 27, 1945, said Duque & 
Frazzini having still failed to faithfully perform 
the work contracted to be done under their said 


Basich Brothers Construction Co. 9 


subeontract with plaintiff, plaintiff did under date 
of April 27, 1945, by registered mail, notify said 
defendants, and each of them, of the failure of said 
Duque & Frazzini to faithfully perform the work 
required of them, and that plaintiff would make all 
reasonable efforts, either in attempting to procure 
sufficient equipment to produce the deficiency in 
material required of said Duque & Frazzini, as 
aforesaid, or attempt to procure the deficiency of 
materials through other sources and make. all 
charges or other reasonable expenses in connection 
therewith against said defendants. 


XIV. 


That by reason of the failure of said Duque & 
Frazzini to perform faithfully the work contracted 
to be done under their said contract with plaintiff, 
as aforesaid, and at their own expense to furnish 
all necessary material and perform all necessary 
labor incidental thereto, it became necessary for 
plaintiff to furnish necessary labor, material and 
equipment for the purpose of completing the work 
contracted to be done by said Duque & Frazzini 
under their said subcontract with plaintiff; that 
from the commencement by said Duque & Frazzini 
of the work required by them under said subcon- 
tract with plaintiff on or about February 19, 1945, 
until the suspension of said work and the abandon- 
ment thereof by said Duque & Frazzini on or about 
June 8, 1945, as herein alleged, by reason of the 
failure of said Duque & Frazzini to perform faith- 
fully the work contracted to be done under said 


10 Glens Falls Indemnity Co. vs. 


subcontract and to, at their own expense furnish 
all materials, supplies and equipment, and perform 
all labor as therein required of them, it became 
necessary for plaintiff to pay and plaintiff did pay 
certain necessary materials, supplies and equip- 
ment used and/or employed by said defendants 
Duque & Frazzini, during said period commencing 
on or about February 19, 1945, to on or about June 
8, 1945, for the purpose of completing the work 
contracted to be done by said Duque & Frazzini 
under said subcontract. 


AV. 


That during said period of time from the com- 
mencement of said work as aforesaid, to on or 
about June 8, 1945, plaintiff furnished and paid 
for necessary labor, materials, supplies and equip- 
ment for the performance by said Duque & Fraz- 
zini of the requirements imposed on them by their 
subcontract with plaintiff, the following items: 
(a) Labor, $46,053.20; Insurance, $6529.59; (b) 
Repairs on Equipment, $275.51; (c) Parts of 
Equipment purchased, $2257.88; (d) Parts of 
Equipment furnished by plaintiff to said Duque & 
Frazzini, $1723.75; (e) Fuel, grease and oil for 
Equipment, $732.47; (f) Rental of Equipment by 
plaintiff to said Duque & Frazzini, fully operated, 
$3989.41; (g) Rental of Equipment by plaintiff 
to said Duque & Frazzini not fully operated, 
$2773.86; (h) Rental of Equipment [8] on tonnage 
basis, $4191.60; (1) Rental of Equipment by Duque 
& Frazzini from (1) P.D.O.C. fully operated, 


Basich Brothers Construction Co. 11 


$6902.37, (2) P.D.O.C. not fully operated, $261.34, 
(3) J. G. North & Sons, $4956.06, (4) A. B. Bonner, 
$625.74, (5) Bressi & Bevanda, $582.72, (6) Indus- 
trial Equipment Co., $176.00; (j) Miscellaneous 
Labor, $2104.40; (k) Freight on Equipment, 
$326.89. That the above items total €85,172.63. 


OVALE 


That during the period from the commencement 
of said work by Duque & Frazzini on or about Feb- 
ruary 19, 1945, to the abandonment thereof, as 
aforesaid, on or about June 8, 1945, said defendants 
had earned, under their said subcontract with 
plaintiff a gross amount of $48,716.22. That said 
gross earnings consist of the following items: 

Item I: Gravel Embankment, 3000 cubic yards 
at contract price of $0.46 a cubie yard, or $1380.00; 

Item II: Gravel, Stab. Base, 7587 cubic yards 
at contract price of $0.40 a cubie yard, or $3034.80; 

Item III: Gravel Base Course, 38,407 cubic 
yards at contract price of £0.46 a cubic va or 
$17,667.22 ; 

Item IV: Concrete, aggregate 01.735 cubic 
yards at contract price of $1.05 a ton, or $22,821.75; 

Item V: Mineral aggregate 4586 tons .at con- 
tract of $0.65 a ton, or $2980.00. fi 

Item VI: Rock Base, A. C. ieeRaCs 309 . cubie 
yards, at $0.46 a eubie yard, or $142.14; 

Item VII: Sand, Seal Coat, 110° tons at i 65 
a ton, or $71.50; 

Item VIII: Oredit, Pi tainene "$505, 00; 

Item IX: Credit, Labor, $92.91. . : 


12 Glens Falls Indenuuty Co. vs. 


That pursuant to the provisions of Article XI 
of said subcontract, plaintiff elected to and did 
apply said gross earnings [9] of $48,716.22 to the 
eredit of said Duque & Frazzini in payment of all 
of the above charge items with the exception of 
Item (a) above being Labor and Insurance, there 
being a balance due plaintiff thereon on account of 
the deficiency between the amounts paid out by 
plaintiff for labor, supplies, materials and equip- 
ment, as aforesaid, in the sum of $85,172.63, and 
said gross earnings of $48,716.22, or $36,456.41. 


XV 


That on or about the 8th day of June, 1945, be- 
fore the completion of the work provided for in 
their said subcontract with plaintiff, said Duque & 
Frazzini notified plaintiff in writing that they were 
suspending their said operations and thereupon 
and on or about said 8th day of June, 1945, without 
the consent of plaintiff, they abandoned said opera- 
tion; that defendant Glens Falls Indemnity Com- 
pany were, at all times, promptly notified by reg- 
istered mail of the aforesaid acts and omissions of 
said Duque & Frazzini, and upon the suspension 
and abandonment of said operations by Duque & 
Frazzini, as aforesaid, plaintiff on June 11, 1945, 
notified said Glens Falls Indemnity Company by 
registered mail, that, as the surety of said Duque & 
Frazzini, it take such action as it may deem proper 
and that until it did so plaintiff, as Prime Contrac- 
tor, upon demand of the War Department, would 
proceed with the work for the benefit of each of 


Basich Brothers Construction Co. 13 


said defendants and would comply with their reason- 
able instructions. Said defendant Glens Falls In- 
demnity Company, however, took no action what- 
ever in the completion of the work, abandoned by 
said Duque & Frazzini as aforesaid, and plaintiff 
was compelled to complete the same; that said 
plaintiff did, at its own expense, furnish labor, 
material and equipment to complete, and did com- 
plete the work covered by its said subcontract with 
Duque & Frazzini hereto attached and marked Ex- 
hibit ‘‘A’’. That in completion thereof after its 
abandonment as aforseaid, and in payment [10] of 
labor and material and rental of equipment and 
miscellaneous bills necessarily incident thereto, 
plaintiff necessarily expended the respective 
amounts and furnished labor, material, machinery 
and equipment as follows: 

(a) Labor $20,452.70, Insurance $2,593.86, (b) 
Repairs on Equipment, $186.48 and $3,969.97, re- 
spectively, (c) Parts for Equipments $4,244.10, (d) 
Fuel, Grease and Oil for Equipment, $1,371.50, (e) 
Rental on Equipment from plaintiff fully operated, 
$18,485.17, (f) Rental of Equipment by Plaintiff 
not fully operated, $2849.56, (g) Rental of Equip- 
ment by plaintiff on tonnage basis, $6753.20, (h) 
Rental of Equipment from (1) P.D.O.C. fully 
operated, $10,412.57, (a) P.D.O.C. not fully oper- 
ated, $108.50, (3) P.D.O.C. on tonnage basis, 
$5349.73, (4) J. G. North & Sons, $27,809.54, (5) 
Phoenix-Tempe Stone, $6,102.05, (6) Bressi-Be- 
vanda, $1,152.61, (7) Martin Construction Com- 
pany, $270.00, (8) Axman-Miller, $700.00, (i) Mis- 


14 Glens Falls Indemnity Co. vs. 


cellaneous labor, $4,803.15, (j) Freight on equip- 
ment, $663.39. That the above items total $118,- 
Pye Uy 

XVIII. 


That during the period from the abandonment 
of said work by said Duque & Frazzini on or about 
June 8, 1945, as aforesaid, until the completion 
thereof by plaintiff, as aforesaid, there was a gross 
earning based on said subcontract in the sum of 
$76,230.73, consisting of the following items: 

Item I, Gravel embankment, 7260 cubic yards at 
contract price of $0.46 a cubic yard or $3339.60; 
Item II, Gravel, Stab. Base, 4869 cubic yards at 
contract price of $0.40 a cubic yard or $1947.60; 
Item III, Gravel Base Course, 16357 cubic yards 
at contract price of $0.46 a cubic yard or $7524.22; 
Item IV, Concrete Aggregate, 46005 cubic yards at 
contract price of $1.05 a evbic yard or $48,305.25; 
Item V, Mineral aggregate, 20768 tons at $0.65 a 
ton or $18,499.20; Item VI, Rock base—A. C. [11] 
La Rue, 81 Cubic yards at. $0.46 a cubic yard or 
$37.26; Item VII Gravel Base 8” C.M.P. 75 eubic 
yards at $0.46 a eubic yard, or $34.50; Item VITI, 
Sand, 2374 tons at $0.65 a ton or $1543.10. That 
the total of the above items is $76,230.73; that there 
is a balance due plaintiff on account of the differ- 
ence in the amount paid out or expended by plain- 
tiff from the date of the abandonment of said sub- 
contract by said Duque & Frazzini on or about June 
8, 1945, to the completion of said work by plaintiff, 
as aforesaid, in the sum of $118,278.03, and the 


Basich Brothers Construction Co. 15 


amount earned in the sum of $76,230.73, or the sum 
of $42,047.30. 
XIX. 


That as shown by said statements herein alleged, 
after giving credit to said defendants for all 
amounts provided for under the terms of said sub- 
contract hereto attached and marked Exhibit ‘‘A”’, 
in connection with the construction and completion 
of the work contracted to be done by said Duque & 
Frazzini, as aforesaid, there is now due, owing and 
unpaid from the defendants, and each of them, on 
account of the defendants’ failure to fully perform 
the aforesaid subcontract work, the sum of $78,- 
503.71. 

XX. 


That plaintiff has done and fully performed each 
and every act on its part to be performed under 
the terms of the aforesaid subcontract, a copy of 
which is attached hereto as Exhibit ‘‘A’’, and under 
the terms of the aforesaid bond, a copy of which 
is attached hereto as Exhibit ‘‘B’’. That each and 
all of the amounts paid out by plaintiff as herein 
alleged and each and all of the charges therein made 
represent the fair and reasonable value of the 
labor, material, equipment and miscellaneous items 
furnished and provided by plaintiff, and each and 
all were necessary in order to perform and fulfill 
the terms and conditions of the aforesaid subcon- 
tract, a copy of which is attached hereto as [12] 
Exhibit ‘‘A’’. 


16 Glens Falls Indemnity Co. vs. 
0.68 

That by reason of the failure of the defendants 
to carry out and faithfully perform said subcontract 
in accordance with the terms thereof, plaintiff has 
suffered a loss as herein set forth in the total sum 
of $78,503.71. 

That the defendants, and each of them, though 
requested to pay said amount, have failed and re- 
fused to do so. That there is now due, owing and 
unpaid from defendants, and each of them, to 
plaintiff the sum of $78,503.71, together with in- 
terest thereon at 7% per annum from the date of 
the respective payments and charges. 

Wherefore, plaintiff prays that it have and re- 
ceive judgment against said defendants, and each 
of them, in the sum of $78,503.71, together with 
interest at seven per cent per annum upon each of 
the amounts so advanced and expended by plaintiff 
from the date of said respective advancements until 
paid. Plaintiff further prays the Court for its costs 
and for such other and further relief as to the 
court may seem meet and proper. 


/s/ STEPHEN MONTELEONE, 
Attorney for Plaintiff. [13] 


State of California, 


County of Los Angeles—ss. 


N. L. Basich, being by me first duly sworn, de- 
poses and says: that he is the President of Plaintiff 
corporation in the above entitled action; that he 


Basich Brothers Construction Co. 17 


has read the foregoing Complaint and knows the 
contents thereof; and that the same is true of his 
own knowledge, except as to the matters which are 
therein stated upon his information or belief, and 
as to those matters that he believes it to be true. 


/s/ N. L. BASICH. 


Subseribed and sworn to before me this 26th day 
of December, 1945. 


/s/ DOROTHY P. SOETH, 
Notary Public in and for said County of Los 
Angeles, State of California. 
My commission expires February 19, 1946. [14] 


EXHIBIT A 
Subcontract Agreement 


This Agreement, made this 7th day of February, 
1945, by and between Basich Brothers Construction 
Co., 600 S. Fremont Ave., Alhambra, California, 
party of the first part, hereinafter called the Con- 
tractor, and Duque & Frazzini, P.O. Box 75, Tono- 
pah, Nevada, party of the second part, hereinafter 
called the Subcontractor, witnesseth: That 


Whereas, the Contractor has heretofore entered 
into a Contract, hereinafter referred to as the 
original contract, dated January 25, 1945, with War 
Department, U. S. Engineer Office, 751 S. Figueroa 
St., Los Angeles, California, hereinafter called the 
Principal, for the Construction of Taxiways, warm- 
up and parking aprons, Job No. Davis-Monthan 


18 Glens Falls Indemnity Co. vs. 


ESA 210-6, 210-8, and 210-9, Davis-Monthan Field, 
Tucson, Arizona, Contract No. W-04-353-Eng.-1302, 
which contract includes the following desribed work 
to be done under this agreement: 

Item 9 Gravel embankment, Item 11 Gravel 
for stabilized subgrade under gravel base 
course, Item 15 Gravel for base course, Item 
21 Rock and sand for 18’-12"-18” Portland 
cement concrete airfield pavement, Item 22 
Rock and sand for 10” Portland cement con- 
erete airfield pavement, Item 26A Rock and 
sand for binder course asphaltic concrete, Class 
1, Item 26B Rock and sand for wearing course 
asphaltic concrete, Class 2. 


Now, Therefore, in consideration of the covenants 
and agreements hereinafter contained and payments 
to be made as hereinafter provided, the Contractor 
and the Subcontractor do hereby mutually agree 
as follows: 


Article I. Performance of Work. 


The Subcontractor shall furnish all materials, 
supplies and equipment, except as otherwise herein 
provided, and perform all labor required for the 
completion of the said work in accordance with all 
provisions of the original contract and of the spe- 
cifications and plans referred to therein, all of which 
are hereby made a part of this agreement, and 
under the direction and to the satisfaction of the 
Principal’s engineer or other authorized representa- 
tive in charge of said work. 


Basich Brothers Construction Co. 19 


Article II. Commencement and Completion 
of Work. 


The work shall be commenced not later than Feb- 
ruary 19, 1945, and shall be completed on or before 
June 3, 1945. 


Article III. Changes in the Original Contract. 


It is mutually agreed and understood that the 
Contractor is not an insurer or guarantor of the 
said work or of any part thereof, or of the per- 
formance by the Principal of the original contract 
as specified therein or otherwise, and that the Sub- 
contractor shall be bound by any changes or altera- 
tions made by the Principal in the said original 
contract, specifications or plans, or in the amount 
of character of said work or any part thereof, to the 
same extent that the Contractor is bound thereby. 


Article IV. Liability of Subcontractor. 


The Subcontractor shall hold and save the Con- 
tractor harmless from any liability for damage to 
the said work, or for injury or damage to persons 
or property occurring on or in connection therewith. 


Article V. Warning Signals, Barricades, Ete. 


The Subcontractor shall provide, erect and main- 
tain proper warning signals, signs, lights, barri- 
eades and fences on and along the line of said work, 
and shall take all other necessary precautions for 
the protection of the work and safety of the public. 


20 Glens Falls Indemnity Co.:vs. 


Article VI. Compensation and Public Liability 
Insurance. 


The Subcontractor, shall at his own expense, pro- 
vide workman’s compensation insurance in accord- 
ance with the requirements of the original contract 
and of all Federal, State and/or municipal laws, 
ordinances and regulations relating thereto; also, 
insurance against liability for injury to persons 
and/or property occurring on or in connection with 
the work; Provided, that if the Subcontractor fails 
to provide such insurance, the Contractor is author- 
ized to provide the same and to deduct the amounts 
of the premiums payable therefor from any moneys 
at any time due the Subcontractor under this agree- 
ment. 

Article VII. Patents. 


The Subcontractor shall hold and save the Con- 
tractor harmless from liability of any nature or 
kind for or on account of the use of any patented 
or unpatented invention, article, appliance or 
process furnished or used in or in connection with 
the performance of the said work. 


Article VIIT. Subletting and Assignment. 


The work shall be performed by the Subcontrac- 
tor with the assistance of workmen under his im- 
mediate superintendence, and shall not be sublet, 
assigned or other wise disposed of, either in whole 
or in part, except with the written consent of the 
Contractor. 


Basich Brothers Construction Co. vad 
Article 1X. Other Subcontractors. 


The Subcontractor shall cooperate fully with 
other subcontractors employed on the work, and 
shall so plan and conduct his work as not to inter- 
fere with their operations or with those of the Con- 
tractor. The Contractor will not be responsible for 
any delays or interference resulting from the acts 
or operations of other subcontractors. 


Article X. Settlement of Controversies. 


In the event any controversies should arise, the 
Contractor and the Subcontractor each will elect a 
representative, and the representative will in turn 
elect a third disinterested party to settle contro- 
versies. All decisions will be final. 


Article XI. Payment for Labor and Supplies. 


The Subcontractor shall promptly make payment 
to all persons supplying him with labor, materials 
and supplies for the prosecution of the work or in 
connection therewith. Any such payments not made 
by the Subcontractor when due may be made by the 
Contractor and the amounts thereof deducted from 
any moneys at any time due the Subcontractor 
under this agreement. 


Article XII. Completion Work by Contractor. 


If the Subcontractor shall fail to commence the 
work within the specified time, or to prosecute said 
work continuously with sufficient workmen and 
equipment to insure its completition the Contractor 


22 Glens Falls Indemnity Co. vs. 


within five (5) days will reserve the right to com- 
pel the Subcontractor to move. in another plant. 
All cost in connection with moving in, moving out, 
erection, dismantling, operation, and any other cost 
in connection with operating and maintaining plant 
will be paid by the Subcontractor. In the event 
Basich Brothers Construction Co. plant is used, 
moving in and moving out expense will be paid by 
Basich [16] Brothers Construction Co. 


Article XIII. Extension of Time. 


No extension of the time herein specified for com- 
pletion will be made in consideration of delays or 
suspensions of work due to the fault or negligence 
of the Subcontractor, and no extension will be 
granted that will render the Contractor liable for 
penalty or damages under the original contract. 


Article XTV. Claims for Extra Work or Damages. 

The Contractor will pay, for extra work per- 
formed and materials furnished by the Subcontrac- 
tor under written authorization by the Principal’s 
engineer, the actual cost thereof plus a percentage 
of said cost equal to one-half the percentage re- 
ceived by the Contractor, as and when he is paid 
therefor by the Principal. 


Article XV. Basis and Scope of Payment. 
Payment will be made to the Subcontractor for 
work actually performed and completed, as mea- 
sured and certified to by the Principal’s engineer, 
at the unit prices hereinafter specified, which prices 
shall be accepted by the Subcontractor as full com- 


Basich Brothers Construction Co. 23 


pensation for furnishing all material and for doing 
all work contemplated and embraced in this agree- 
ment; also all loss and damage arising out of the 
nature of the work aforesaid, and for all risks of 
every description connected with the said work; 
also for all expense incurred by the Subcontractor 
by or in consequence of the suspension or discontin- 
uance of the work. 


Article XVI. Partial Payment. 


Partial payments for work performed under this 
agreement will be made by the Contractor on the 
basis of 90% of engineers estimate and 90% of 
useable materials in stockpile. In the event the 
Subcontractor is indebted to the Contractor for 
eash advances, supplies, materials, equipment, 
rental, labor, insurance on labor, or other proper 
charges against the work, the amount of such in- 
debtedness may be deducted from any payment or 
payments made under this provision. 


Article XVII. Final Payment. 


Upon the completion of the Subcontractors con- 
tract, the Contractor will pay the remaining amount 
due him under this agreement within 30 days. All 
prior partial payments shall be subject to correc- 
tion in the final payment; Provided, that if, on com- 
pletion of the said work by the Subcontractor and 
prior to the completion of the original contract as 
a whole, the Subcontractor shall demand and re- 
ceive full payment for his work according to the 
computations of the Principal’s engineer, any 


24 Glens Falls Indemiuity Co. vs. 


changes thereafter made in said computations shall 
not inure in whole or in part to the benefit or less 
of the Subcontractor. Final payment as herein 
provided shall release the Contractor from any fur- 
ther obligation whatsoever in respect to this agree- 
THEI. 


Article XVIII. Faihiwe to Enforce Provisions 
Not a Waiver. 


The failure of the Contractor to enforce at any 
time any of the provisions of this contract or to re- 
quire at any time performance by the Subcontractor 
or any of the provisions hereof, shall in no way be 
construed to be a waiver, nor in any way to affect 
the validity of this agreement or any part thereof 
or the right of the Contractor to thereafter enforce 
each and every such provision. 


Article XIX. Penalties. 


It is understood that any fines, penalties, levies, 
assessinents or charges for liquidated damages of 
any nature made by the Principal upon the Con- 
tractor for work done under this agreement will be 
charged to the Subcontractor. [17] 


Article XX. Delays. 


The Subcontractor shall have no claim for dam- 
ages due to delays in delivery of material or failure 
of the Principal to provide Right of Way, plans, 
stakes, or delay from any cause whatsoever. 


Basich Brothers Construction Co. 245) 
Article XXI. Special Provisions. 


1. All materials to be taken from Mr. and 
Mrs. Collbs property. 


2. Basich Brothers Construction Co. to pay 
for all royalties for materials. In the event 
Mr. and Mrs. Collbs material pit is exhausted, 
Basich Brothers Construction Co. will pay 
royalties for other material in the immediate 
vicinity. 

3. Duque & Frazzini to submit weekly pay- 
rolls by Monday night of each week for the 
previous week which closes on Saturday at mid- 
night to Basich Brothers Construction Co. 
Basich Brothers Construction Co. to pay labor, 
compensation, insurance, public hability, prop- 
erty damage, Arizona employment insurance, 
Federal Old Age, Excise Tax on Employers and 
any other insurance on labor and charge same 
to Duque & Frazzini, which amounts are to be 
deducted from amount earned. 

4. Duque & Frazzini to pay Arizona Tax 
Commission for privilege of doing business in 
Arizona. 


9. Duque & Frazzini to erect two plants, 
each to produce 800 cy. of suitable material to 
be used in connection. with. the. contract. 

6. Duque & Frazzini to stockpile rock and 
sand for concrete pavement nearest to second 
party’s plant. Same thing applies to rock and 
sand for asphalt concrete pavement. 


26 


Glens Falls Indemnity Co. vs. 


7. Rock furnished for Items 21 and 22 shall 
be 3” (three-inch) maximum; prices furnished 
by Duque & Frazzini on these Items are predi- 
cated on the 3” maximum rock. 


8. Permission is hereby granted to Duque & 
Frazzini to subcontract a portion of their con- 
tract to Vegas Rock & Sand Co., Las Vegas, 
Nevada. 


Article XXII. (a) Renegotiation Pursuant to 


Section 403 of the Sixth Supplemental National 
Defense Appropriation Act, 1942. 


If this Subcontract is in excess of one hundred 
thousand dollars, ($100,000.00), the Subeon- 
tractor agrees to renegotiate his contract prices 
pursuant to Section 403 of the Sixth Supple- 
mental National Defense Appropriation Act, 
1942, Publie Law 528. 


(a) At such period or periods when, in the 
judgment of the Secretary of War, the profits 
accruing to the contractor under this contract 
ean be determined with reasonable certainty, 
the Secretary of War and the contractor, upon 
the written demand of the Secretary of War, 
will negotiate the contract price with a view to 
eliminating such profits as are found as a result 
of such renegotiation to be excessive. 


(b) In the event that such renegotiation 
results in a reduction of the contract price, the 
amount of such reduction shall be retained by 


Basich Brothers Construction Co. 27 


the Government or repaid to the Government 
by the Contractor, as directed by the Secretary 
of War. 


(c) Each fixed-price or lump sum subcon- 
tract in an amount in excess of $100,000 entered 
inte by the contractor hereunder shall include 
the following provisions: [18] 


(1) At such period or periods when, in the judg- 
ment of the Secretary of War, the profits accruing 
to the Subcontractor under this contract can be 
determined with reasonable certainty, the Secretary 
of War and the Subcontractor, upon the written 
demand of the Secretary of War, will renegotiate 
the contract price with a view to eliminating such 
profits as are found as a result of such renegotiation 
to be excessive. 


(2) In the event that such renegotiation results 
in a reduction of the contract price, the amount of 
such reduction shall, as directed by the Secretary 
of War, 

(A) Be deducted by the Gone: from 
payments to the Subcontractor under this con- 
(MBE s (Ok 

(B) Be paid by the Subeontractor dineene 
to the Government; or 

(C) Be repaid by the Subcontractor to the 
Contractor. 


(3) The Subcontractor agrees that the Contractor 
shall not be liable to the Subcontractor for or on 
account of any amount repaid to the Contractor or 


28 Glens Falls Indemnity Co. vs. 


paid to the Government by the Subcontractor or 
deducted by the Contractor from payments under 
this contract, pursuant to directions from the Sec- 
retary of War in accordance with the provisions of 
this Article. Under its contract with the Govern- 
ment, the Contractor is obligated to pay or credit 
to the Government all amounts repaid by or with- 
held from the Subcontractor hereunder. 


(4) The term ‘‘Secretary of War’’ as used herein 
includes his duly authorized representatives. 

(d) If any renegotiation between the Secre- 
tary of War and any Subcontractor pursuant 
to the provisions required by paragraph (ce) 
hereof results in a reduction of the contract 
price of the subcontract, the Government shall 
retain from payments to the Contractor under 
this contract, or the Contractor shall repay to 
the Government, as the Secretary of War may 
direct, the amount of such reduction, less any 
amounts paid thereon by the Subcontractor di- 
rectly to the Government. 

(e) The term ‘‘Secretary of War’’ as used 
herein includes his duly authorized represen- 
tatives. 


Article XXII. Bond Provision. 


Duque & Frazzini to furnish 100% Combination 
Bond (labor, material, and performance). Basich 
Brothers Construction Co. will pay for said bond. 


Basich Brothers Construction Co. 29 


Article XXIII. 
Prices with Approximate 


Amounts 


Approximate 
Item Quantity Unit 


9 15,300 cy. 


th e000” cy: 


15 42,530 ey. 


Description 


Gravel embankment, Gravel 
embankment shall be put in 
bin by second party and 
hauled away by first party. 
Any over- production that 
trucks cannot haul away 
shall be put in stockpile by 
second party and rehandled 
by first party. Engineers fill 
measurement to be used to 
govern quantities. 


Gravel for stabilized  sub- 
grade under’ gravel base 
course. Gravel shall be put in 
by second party and hauled 
away by first party. Any 
overproduction that trucks 
cannot haul away shall be 
put in stockpile by second 
party and rehandled by first 
party. Measurement to be 
computed on truck water 
level. 


Gravel for base course. 
Gravel shall be put in bin by 
second party and _ hauled 
away by first party. Any 
overproduction that trucks 
cannot. haul away shall be 
put in stockpile by .second 
party and rehandled by first 
party. Engineers fill measure- 
ment to be used to govern 
quantities. 


Schedule of Subcontract Unit 
Quantities and 


Approximate 
Price Amount 


46 7,038.00 


40 3,600.00 


46 


30 Glens Falls Indemnity Co. vs. 


Approximate 
Item Quantity Unit 


21 49,600 cy. 


22 6,320 cy. 


26A 8,535 tons 


26B 11,200 tons 


Description 


Rock and sand for 18”’—12” 
18” Portland cement concrete 
airfield pavement. Rock and 
sand shall be put in stockpile 
by second party and rehan- 
dled by first party. Engineers 
measurement for concrete 
will be used to govern quan- 
tities. 


Rock and sand for 10” Port- 
land cement concrete airfield 


‘pavement. Rock and _ sand 


shall be put in stockpile by 
second party and rehandled 
by first party. Engineers 
measurement for concrete 
will be used to govern quan- 
tities. 


Rock and sand for binder 
course asphaltic concrete, 
Class 1. 


Rock and sand for wear- 
ing course asphaltic con- 
crete, Class 2. 

Rock and’ sand for Items 
26A, and 26B, shall be put in 
stockpile by second party 
and rehandled by first party. 
Engineers weights for vari- 
ous classes of asphalt concrete 
will be used to govern quan- 
tities; however, oil used is to 
be removed first before ton- 
nage computed. 


Approximate 
Price Amount 


1.05 


1.05 


.65 


.65 


Basich Brothers Construction Co. 31 

Article XXIV. Damages for Delay in Completion. 
If the Subcontractor shall fail to complete the 
said work within the time and in the manner speci- 
fied, or within the time of such extensions as may be 
granted, he shall forfeit and pay to the Contractor 
the sum of the amount assessed by U. 8. Engineer 
Office, per day for each calendar day that he is in 
default according to the terms hereof, which sum 
the Contractor shall retain as liquidated damages. 


Article XXV. 


It is mutually agreed that time is of the essence 
of this [20] agreement, and that it contains the 
whole and entire understanding of the parties 
hereto, and that it shall bind their heirs, executors, 


administrators, successors and assigns. 


In Witness Whereof, the said parties have here- 
unto set their hands the day and year above written. 


BASICH BROTHERS 
CONSTRUCTION CO., 


By /s/ N. L. BASICH 
Party of the First Part 
DUQUE & FRAZZINI| 
By /s/ CARSON FRAZZINI — 
Party of the Second Part: 


32 Glens Falls Indemnity Co. vs. 


EXHIBIT B 


Glens Falls Indemnity Company 
Of Glens Falls, New York 


Sub-Contract Bond 


Know All Men By These Presents, That we, Duque 
& Frazzini of Tonopah, Nevada, (hereinafter called 
the Principal) as Principal and Glens Falls Indem- 
nity Company, of Glens Falls, New York (herein- 
after called the Surety) as Surety, are held and 
firmly bound unto Basich Brothers Construction 
Co., 600 S. Fremont Ave., Alhambra, California, 
(hereinafter called the Obligee) in the sum of One 
Hundred One Thousand Seven Hundred Forty-five 
and 55/100 ($101,745.55) Dollars, for the payment 
whereof said Principal and Surety bind themselves 
firmly by these presents. 


Whereas, the Principal has entered into a written 
contract dated February 7th, 1945, with the Obligee 
for— 

The construction of taxiways, warm-up and 
parking aprons, Job No. Davis-Monthan ESA 
210-6, 210-8 and 210-9, Davis-Monthan Field, 
Tueson, Arizona, Contract No. W-04-353-Eng.- 
1302. 

a copy of which is or may be hereto annexed. 


Now, Therefore, The Condition Of This Obliga- 
tion Is Such, that if the Principal shall faithfully 
perform the work contracted to be performed under 
said contract, and shall pay, or cause to be paid in 
full, the claims of all persons performing labor upon 


Basich Brothers Construction Co. 33 


ov furnishing materials to be used in, or furnishing 
appliances, teams or power contributing to such 
work, then this obligation shall be void; otherwise 
to remain in full force and effect. 


This bond is executed for the purpose of comply- 
ing with the laws of the State of Arizona, and shall 
inure to the benefit of any and all persons who per- 
form labor or furnish materials to be used in, or 
furnish appliances, teams or power contributing to 
the work described in said contract, so as to give 
such persons a right of action to recover upon this 
bond in any suit brought to foreclose the hens pro- 
vided for by the laws of the State of Arizona, or in 
a separate suit brought on this bond. No right of 
action shall accrue hereunder to or for the use of 
any person other than the Obligee except as such 
right of action may be given by the Mechanies’ Lien 
Laws of the State of Arizona to persons performing 
labor or furnishing materials, appliances, teams or 
power as aforesaid. The total amount of the 
surety’s liability under this bond, both to the 
Obligee and to persons furnishing labor or material, 
applianees, teams or power, shall in no event ee 
the penalty hereof. 


The Principal and Surety further agree to pay 
all just labor claims arising under said contract, 
within two (2) weeks after demand, and to waive 
the filing of len claims or giving written notice re- 
quired by Statute as a condition to ian suit 
to enforce the same. 


34 Glens Falls Indemnity Co. vs. 


Provided, however, as to said Obligee, and upon 
the Express Conditions, the performance of each 
of which shall be a condition precedent to any right 
of recovery hereon by said Obligee: 


First: That in the event of any default on the 
part of the Principal, written notice thereof shall 
be delivered to the Surety, by registered mail at its 
office in the City of Los Angeles promptly, and in 
any event within ten (10) days after the owner, or 
his representative, or the architect, if any, shall 
learn of such default; that the Surety shall have 
the right, within thirty (30) days after receipt of 
such notice, to proceed or procure others to proceed 
with the performance of such contract; [22] shall 
also be subrogated to all the rights of the Principal; 
and any and all moneys or property that may at the 
time of such default be due, or that thereafter may 
become due to the Principal under said contract, 
shall be credited upon any claim which the Obligee 
may then or thereafter have against the Surety, 
and the surplus, if any, applied as the Surety may 
direct. 


Second: That the Obligee shall faithfully per- 
form all of the terms, covenants and conditions of 
such contract on the part of the Obligee to be per- 
formed; and shall retain the last payment payable 
by the terms of said contract, and all reserves and 
deferred payments retainable by the Obligee under 
the terms of said contract until the complete per- 
formance by the Principal of said contract, and 
until the expiration of the time within which notice 


Basich Brothers Construction Co. 35 


of claims or claims of liens by persons performing 
work or furnishing materials under said contract 
may he filed and until all such claims shall have 
been paid, unless the Surety shall consent, in writ- 
ing, to the payment of said last payment, reserves 
or deferred payments. 


Third: That the Surety shall not. be liable for 
any damages resulting from strikes, or labor diffi- 
culties, or from mobs, riots, fire, the elements, or 
acts of God, or for the repair or reconstruction of 
any work or materials damaged or destroyed by any 
such causes, nor for damages from injury to, or the 
death of, any persons, nor for the non-performance 
of any guarantees of the efficiency or wearing quali- 
ties of any work done or materials furnished, or the 
maintenance thereof, or repairs thereto, nor for the 
furnishing of any bond or obligation other Sie this 
instrument. 

Signed, sealed and dated this 20th ie of Feb- 
ruary, 1945. 

DUQUE & FRAZZINT, 
By CARSON FRAZZINI, 


[Corporate Seal] 
GLENS FALLS INDEMNITY 
COMPANY, 
By /s/ HARRY LEONARD, 
Attorney. 


36 Glens Falls Indemnity Co. vs. 


State of California, 
County of Los Angeles—ss. 


On this 20th day of February in the year One 
Thousand Nine Hundred and Forty-five, before me, 
Marwin F. Jonas, a Notary Public in and for said 
County of Los Angeles, residing therein, duly com- 
missioned and sworn, personally appeared Harry 
Leonard, known to me to be the Attorney of the 
Glens Falls Indemnity Company, the Corporation 
that executed the said instrument on behalf of the 
Corporation therein named and acknowledge to me 
that such Corporation executed the same. 


In Witness Whereof, I have hereunto set my hand 
and affixed my official seal in the County of Los 
Angeles the day and year in this certificate first 
above-written. 


[Notarial Seal] MARWIN F. JONAS, 
Notary Public in and for the County of ... 33am 
State of California. 


My commission expires Nov. 2, 1947. 


[Endorsed]: Filed Dec. 27, 1945. [23] 


Basich Brothers Construction Co. Bo if 
[Title of District Court and Cause. ] 
BILL OF PARTICULARS 


State of California, 
County of Los Angeles—ss. 


N. L. Basich, being first duly sworn, deposes and 
says: That he is the President of plaintiff corpora- 
tion in the above-entitled action; that attached 
hereto, marked Schedules I to XX XXIV, inclusive, 
and made a part hereof, is an itemized statement 
set forth in particular constituting the items mak- 
ing the claim alleged in plaintiff’s complaint on file 
herein; and that the same is true of his own 
knowledge. [24] 


That said schedules are for the following items 
and amounts: 


Schedule Amount 
No. Item Charge Credit 

I Payroll— 
Duque & Prazginy 222... $ 38,979.65 

II Payroll— 
Pioneer Crusher ...............- 8,240.54 

III Payroll— 
Pioneer Crusher ...............-- 12,172.04 

IV Payroll— 
Fob. O. C. Crusher... 3,290.01 

V_ Payroll— 
Hot Plant—Sand ................ 2,888.92 


Va INSURANCE: <.222.0002.0220:.:... ae 38,979.65 


VII Equipment Rental—Fully 
Operated—Basich Brothers 
Construction Co. ................ 3,989.41 


38 


Schedule 
No. 


Vill 


Ix 


XI 


XIT 


XIII 


XIV 


XV 


XVI 


XVIT 


XVIII 


Glens Falls Indemnity Co. vs. 


Item 


Equipment Rental — Not 
Fully Operated — Basieh 
Brothers Construction Co. 


Equipment Rental— 
Royalty Basis — Basiech 
Brothers Construction Co. 


Equipment Rental—Fully 
Operated—P. D. O. C.2....... 
Not Fully Operated............ 


Equipment Rental—Fully 
Operated by Basich Broth- 
ers—J. J. North & Sons... 


Equipment Rental—Fully 
Operated—B. B. Bonnev.... 


Equipment Rental — Not 
Fully Operated—Bressi & 
LSYes’ 2) 1 rn ie hn A 


Equipment Rental — Not 
Fully Operated—Industrial 
ES quiqpmnare at 1G Oe ee- 


Equipment Rental—Fully 
Operated — Basich Broth- 
ers Construction Co........... 


Equipment Rental — Not 
Fully Operated — Basich 
Brothers Construction Co. 


Equipment Rental— 
Royalty Basis — Basich 
Brothers Construction Co. 


Equipment Rental — Not 
Fully Operated —P. D. 
OC, 2. oe 2. eee 


Equipment Rental—Fully 


Operated—P. D. O. C....... 


Amount 
Charge 


$2,773.86 
4,191.60 
6,902.37 


261.34 


4,956.06 


625.74 
582.72 
176.00 

18,485.17 

2,849.56 
6,753.20 


108.50 


10,412.57 


Credit 


Schedule 
No. 


XX 


XXI 


XXII 


XXITI 


XXIV 


XXV 


XAXVI 


XXVIT 


XXVIII 


XXIX 


XXX 


XXXI 


Item 


Equipment Rental— 
Royalty Basis—P. D. O. C. 


Equipment Rental—Fully 
Operated—J. G. North & 
SDL Se ee nore ee eer 


Equipment Rental—Fully 
Operated—Phoenix Tempe 
BPO. COs xi.ots soo rete eet 


Equipment Rental — Not 
Fully Operated—Bressi & 
Bevan Gass. 2.22 ee 


Equipment Rental — Not 
Fully Operated — Martin 
Construction Co. ............-..- 


Equipment Rental — Not 
Fully Operated — Axman- 
Miller Construction Co..... 


Repairs made by others on 
Basich Brothers Construc- 
tion Co. Equipment—Not 
Bully Operated) .:.scc00102.- 


Parts purchased for Basich 
Brothers Construction Co. 
Equipment Not Fully 
CONCICTEN GG MNNet any ee eee 


Parts Taken from Basich 


Brothers Construction Co. 
SOO aes orca ERM Te 


Fuel, Grease and Oil on 
Equipment Not Fully 
Operated 


Seen reteanetnensaeecasaaseans 


Miscellaneous Labor, In- 
OLOCS) |) Ce ara 


Freight on Rented Equip- 
ment 


Adecco enemammanaceceeaseeeesseeasen 


Basich Brothers Construction Co. 


Amount 
Charge 


$5,349.73 


27,809.54 


6,102.05 


1,152.61 


270.00 


700.00 


275.51 


2,257.88 


1,723.75 


732.47 


2814.24 


326.89 


39 


Credit 


40 


Schedule 
No. 


XXXIT 


XXXII 


XXXIV 


XXAVI 


AXA WEL 


XXXVI 
AAXIX 


XXXK 


XXAXXI 


XXXXII 


AAR AIIM 


AXXXIV 


Glens Falls Indemnity Co. vs. 


Amount 
Item Charge Credit 

Repairs Made by Others 
on Basich Brothers Con- 
struction Co. Equipment 
Not Fully Operated........... $3,969.97 
Parts Purchased for Basich 
Brothers Construction Co. 
Equipment Not Fully 
Operated: 2220.2 BEALS) JIS) 
Parts Taken from Basich 
Brothers Construction Co. 
SEOCIM ase eee 1,028.91 
Fuel, Grease and Oil on 
Equipment Not Fully 
Operatedic. tts s.c.eee 1,371.50 
Miscellaneous Labor, In- 
OUCES o HiGGeee tess <2 5. on-nccs ee 4,803.15 
Freight on Rented Equip- 
AB Taig ee ee echt cme 663.39 
Production—Gravel Base.. $ 25,191.44 
Production — Gravel Sta- 
blized Baseme = eee 25 4,109.20 
Production — Gravel Em- 
amisment 2.292 4,719.60 
Production—Conecrete Ag- 
TROCALC. 4.4. cee ees 70,710.52 
Production — Mineral Ag- 
MEG SMC a c6 scedis ce klteees noe 15,377.93 
Production—Conecrete Ag- 
gregate for Structures........ 405.30 
Miscellaneous Credits ........ 1,319.96 

$201,124.04 $121,833.95 
Vetal, Charges... $201,124.04 
NotaleCredits: 2... 222 121,833.95 
Balance Due 2... ee $ 79,290.09 


/s/N. L. BASICH 


Basich Brothers Construction Co. 


41 


Subscribed and sworn to before me this Ist day 
of July, 1946. 


[Seal] 


/3/ KAY TWOMBLEY 


Notary Public in and for said 


County and State. 


My Commission expires: Feb. 13, 1950. [29] 


Payroll. Duque & Frazzini. 
$38,979.65. 


SCHEDULE I 


2/11/45 to 6/9/45. 


Employee: Brown, Jack. Occupation: Tractor Driver 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Period 


2/11-2/1T/45 
2 /18-2,/24/45 
2/25-3/ 3/45 
3/ 4-3/10/45 
3/11-3/17/45 
3/18-3/24/45 
3/25-3/31/45 
4/ 1-4/ 7/45 
4/ 8-4/14/45 
4/15-4/21/45 
4/22-4/28/45 
4/29-5/ 5/45 
5/ 6-5/12/45 


14 
32 


32 
30 
32 
40 
16 
40 
32 
12 
40 
40 


Hours Worked 


Regular Overtime 


20.5 
28 
14 


Gross 
Wages 
$ 67.13 
111.00 
31.50 
90.75 
111.00 
162.75 
174.75 
57.75 
154.50 
171.75 
59.63 
111.75 
164.63 


$1,468.89 


42 Glens Falls Indemmuty Co. vs. 


Employee: Cohen, Sidney. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
2/11-2/17/45 16 12 $ 34.00 
2/18-2/24/45 16 8 28.00 
3/18-3/24/45 16 55 24.25 
TOP oo etetesetentesic ince $ 86.25 


Employee: Greer, Clyde. Oceupation: Laborer 
Rate of Pay: Regular Time, $.825; Overtime, $1.2375 


Hours Worked Gross 

Period Regular Overtime Wages 
2/11-2/17/45 32 12.5 $ 41.87 
2/18-2/24/45 34 31 70.44 
2/25-3/ 3/45 8 1 Sel 
TT ORCI coo I $ 120.62 


Employee: Hurler, Ray. Occupation, Tractor Operator 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Hours Worked Gross 

Period Regular Overtime Wages 
Py) At NG 30.5 14 e 7725 
2/18-2/24/45 36 31 123.75 
2/25-3/ 3/45 40 36 141.00 
3/ 4-3/10/45 2y 17.5 87.38 
3/11-3/17/45 40 37 143.25 
3/18-3/24/45 37.9 20 121.50 
3/25-3/31/45 40 34 136.50 
4/ 1-4/ 7/45 40 33 134.25 
4/ 8-4/14/45 12 27.00 
4/15-4/21/45 8 25 17.63 
4/29-5/ 5/45 40 30 127.50 
5/ 6-5/12/45 50 40 150.00 
5/13-5/19/45 40 30 127.50 
5/20-5/26 /45 40 32.5 133.13 
5/27-6/ 2/45 16 39.5 112.88 
6/ 3-6/ 3/45 40 ot 107.25 


Total «22:34. .222 ee $1,767.77 


Basich Brothers Construction Co. 43 


Employee: Humez, Alex. Occupation: Laborer 
Rate of Pay: Regular Time, $.825; Overtime, $1.2375 


Hours Worked Gross 
Period Regular Overtime Wages 
2/11-2/17/45 32 13.5 $ 43.11 


Rate of Pay Changed to: Regular Time, $.875; Overtime, $1.3125 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 34 31 $ 70.44 
PIR Orel ene ee oad a eres a ay «vs ee $ 113.55 


Employee: MeDaniel, Joe. Occupation: Laborer 
Rate of Pay: Regular Time, $.825; Overtime, $1.2375 


Hours Worked Gross 
Period Regular Overtime Wages 
2/11-2/17 /45 16 11 $ 26.81 


Rate of Pay Changed to: Regular Time, $.875; Overtime, $1.3125 


Hours Worked Gross 


Period Regular Overtime Wages 
2 /18-2,/24/45 34 31 $ 70.44 
2/25-3/ 3/45 8 1 8.31 
UN OUUEH | . eee sane Radel e. 0 Ae ae Se ne $ 105.56 


Employee: Ryan, Earl. Oceupation: Crusher Supt. 
Rate of Pay: Regular Time, $600.00 per mo. 


Hours Worked Gross 

Period Regular Overtime Wages 
2/11-2/17/45 56 $ 138.46 
2/18-2/24/45 56 138.46 
2/25-3/ 3/45 56 138.46 
3/ 4-3/10/45 56 138.46 
3/11-3/17/45 56 138.46 
3/18-3/24/45 56 138.46 


BO fas ease 2e eee dis ah oad ideas $ 830.76 


44 Glens Falls Indemnity Co. vs. 


Emplovee: Scott, Earl. 


Period 
9/11-2/17/45 
2 /18-2/24/45 
2/25-8/ 3/45 
3/ 4-3/10/45 
3/11-8/17/45 
3/18-3/24/45 
3/25-3/31/45 
4/ 1-4/ 7/45 
4/ 8-4/14/45 
6/ 3-6/ 9/45 


Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked 
Regular Overtime 

40 18 
40) 27.9 
24 8 
34 11.5 

8 2 
25 24.5 
32 31.5 
40 29 
24 7 
40 16 


Gross 
Wages 


$ 67.00 
81.25 
36.00 
51.25 
11.00 
61.75 
79.25 
83.50 
49.50 
64.00 


$ 584.50 


Employee: Stillwell, Hailey. Occupation: Laborer 
Rate of Pay: Regular Time, $.825; Overtime, $1.2375 


Period 


9/11-2/17/45 


Hours Worked 
Regular Overtime 
2005 11.5 


Gross 
Wages 


$ 38.57 


Rate of Pay Changed to: Regular Time, $.875; Overtime, $1.3125 


Period 


2/18-2/24/45 


Emplovee: Taylor, Paul. 


Hours Worked 
Regular Overtime 
34 31 


Gross 
Wages 


$ 70.44 


$ 109.01 


Occupation: Foreman 


Rate of Pay: Regular Time, $1.75; Overtime, $2.625 


Period 
2/11-2/17/45 
2 /18-2/24/45 
2/25-3/ 3/45 
3/ 4-3/10/45 
3/11-3/17/45 
3/18-3/24/45 
3,/25-3/31 /45 


Hours Worked 
Regular Overtime 

9.5 

40 34 
40 34.5 

32 28 
40 31.5 

36 24 

8 2 


Gross 
Wages 


$ 24.94 
159.25 
160.56 
129.50 
152.69 
126.00 

19.25 


$ 772.19 


Basich Brothers Construction Co. 45 


Employee: Allred, Vaughn P. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-3/24/45 37 48 $ 109.00 
2/25-3/ 3/45 32 21 63.50 
3/ 4-3/10/45 2 9 34.50 
3/11-3/17/45 8 2 11.00 
3/18-3/24/45 29 23 63.50 
3/25-8/31/45 36 27 76.50 
4/ 1-4/ 7/45 40 23 74.50 
4/ 8-4/14/45 40 24 76.00 
4/15-4/21/45 40 25.5 78.25 
4 /22-4/28 /45 40 oT 80.50 
4/29-5/ 5/45 16 15 38.50 
5/ 6-5/12/45 40 98.5 82.75 
5 /13-5/19/45 40 20.5 70.75 
5 /20-5/26/45 40 34.5 91.75 
5/27-6/ 2/45 32 35.5 85.25 
6/ 3-6/ 9/45 40 23 74.50 
“TONERS - 2:8 ec eee ome een ee oboe oememee ree 1 $1,110.75 


Employee: Bogle, Farrow. Occupation: Carpenter 
Rate of Pay: Regular Time, $1.35; Overtime, $2.025 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 40 33.5 $ 121.84 
2/25-3/ 3/45 34.5 25 97.21 
3/ 4-3/10/45 32 21 85.73 
3/11-3/17/45 32 17.5 78.64 


dane PSC Sr a ee OE $ 383.42 


46 Glens Falls Indemnity Co. vs. 


Employee: Hampton, Clarence. Occupation: Plant Foreman 
Rate of Pay: Regular Time, $1.75; Overtime, $2.625 


Hours Worked Gross 

Period Regular Overtime Wages. 

9 /18-2,/24/45 38 21.5 $ 122.94 
2/25-3/ 3/45 36 30.5 143.06 
3/ 4-3/10/45 32 30.5 136.06 
3/11-8/17/45 32 17 100.63 
3/18-3/24/45 37.5 33 152.26 
3/25-38/31/45 40 54.5 213.06 
4/ 1-4/ 1/45 40 44 185.50 
4/ 8-4/14/45 40 45.5 189.44 
4/15-4/21/45 40 45 188.13 
4 /22-4/28/45 40 46 190.75 
4/29-5/ 5/45 40 53 209.13 
5/ 6-5/12/45 40 50.5 202.56 
5/13-5/19/45 40 41 177.63 
5/20-5/26/45 40 51 203.88 
5/27-6/ 2/45 32 55.5 201.69 
6/ 3-6/ 9/45 40 31.5 152.69 
ROU sccssetccec cee tcc $2,769.41 


Employee: Hampton, Ernest. Occupation: Laborer 
Rate of Pay: Regular Time, $.875; Overtime, $1.3125 


Hours Worked Gross 

Period Regular Overtime Wages. 
2/18-2/24/45 8.5 $ dike 
2/25-3/ 3/45 33 13 45.94 
3/ 43/10/45 32 28.00 
3/11-3/17/45 16 14 32.38 
3/18-3/24/45 36 Zi 66.94 
3/25-3/31/45 40 28.5 72.41 
4/ 1-4/ 7/45 40 28.5 72.41 
4/ 8-4/14/45 40 28.5 72.41 
Rate of Pav Changed to: Regular Time, $.90; Overtime, $1.35 
oe! Hours Worked Gross 

Period Regular Overtime Wages 
4/15-4/21/45 10 10 22.50 


~ccddoulkatonckssess a(t ae ee $ 424.15 


Basich Brothers Construction Co. 47 


Employee: Hansen, Carl. Occupation: Oiler 
Rate of Pay: Regular Time, $.975; Overtime, $1.4625 


Hours Worked Gross 

Period Regular Overtime Wages. 
2/18-2/24/45 8 13 $ 26.81 
2/25-8/ 3/45 34 46.5 101.16 
3/ 4-3/10/45 32 11.5 48.02 
3/11-3/17/45 40 38 94.58 
3/18-3/24/45 36 35.5 87.02 
3/25-3/31/45 22 35.5 83.12 
4/ 1-4/ 7/45 40 42.5 101.16 
4/ 8-4/14/45 40 52 115.05 
4/15-4/21/45 29 ii 53.14 
RG eee ce $ 710.06 


Employee: Harvey, John. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 i) 8.5 $ 29.75 
2/25-3/ 3/45 34 12 52.00 
3/ 43/10/45 34 5 34.75 
3/11-3/17/45 8 2 11.00 
"TG TEeSi 2 Catered ns ee ee $ 127.50 


Employee: Johnson, Joseph. Occupation: Timekeeper 
Rate of Pay: Regular Time, $300.00 per mo. 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 48.5 $ 49.45 
2/25-8/ 3/45 . 56 69.23 
3/ 4-3/10/45 56 69.23 


Phd eee ek $ 187.91 


48 Glens Falls Indemnity Co. vs. 


Employee: Mariscal, Frank. Occupation: Laborer 
Rate of Pay: Regular Time, $.875; Overtime, $1.3125 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 8.5 $ 11.16 
2/25-3/ 3/45 25 13 38.94 
3/ 43/10/45 32 15 47.69 
3/11-3/17/45 40 29 73.06 
3/18-3/24/45 36 27 66.94 
3 /25-3/31/45 40 29 73.06 


Occupation Change: Oiler 


Rate of Pay Changed to: Regular Time, $.975; Overtime, $1.4625 


Hours Worked Gross 

Period Regular Overtime Wages 

4/ 1-4/ 7/45 40 33 $ 87.26 
4/ 8-4/14/45 40 34.5 89.46 
4/15-4/21/45 34 92.5 66.06 
4/22-4/28 /45 39 24.5 67.03 
4/29-5/ 5/45 40 40 97.50 
5/ 6-5/12/45 40 2955 115.84 
5/13-5/19/45 40 46 149.88 
5/20-5/26/45 40 26 108.63 
5/27-6/ 2/45 O4 40.5 116.53 
6/ 3-6/ 9/45 40 Zee 111.72 
SN Oe st as SRO ee $1,320.76 


Employee: Sanders, Barney. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime A Wages 
2/18-2 /24/45 24 11 $ 40.50 
2/25-3/ 3/45 34 12.5 52.75 


Basich Brothers Construction Co. 49 


Employee: Talavera, Peliciano. Oeeupation: Laborer 
Rate of Pay: Regular Time, $.875; Overtime, $1.38125 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 8.5 $ liei6 
9/25-8/ 3/45 33 13 45.94 
3/ 4-3/10/45 32 10.5 41.78 
3/11-3/17/45 16 9.5 26.47 
3/18-3/24/45 28 14.5 43.53 
3/25-3/31/45 36 28.5 68.91 
4/ 1-4/ 7/45 40 30 74.38 


Rate of Pay Changed to: Regular Time, $.90; Overtime, $1.35 


Hours Worked Gross 
Period Regular Overtime Wages 

4/ 8-4/14/45 40 33 $ 80.55 
4/15-4/21/45 34 21.5 59.63 
4/224 /28/45 32 21 57.15 
4/29-5/ 5/45 16 18 38.70 
5/ 6-5/12/45 40 29 75.15 
5/13-5/19/45 32 29 67.95 
5 /20-5 /26/45 40 31.5 78.53 
5/27-6/ 2/45 32 39.5 82.13 
6/ 3-6/ 9/45 40 17.5 59.63 

ticle ce een aeRO rive: es 2) ee $ 911.59 


Employee: Van Valkenburg, Edward. Oceupation, Laborer 
Rate of Pay: Regular Time, $.875; Overtime, $1.3125 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24 /45 8.5 $ 11.16 
2/25-3/ 3/45 33 13 45.94 
3/ 4-3/10/45 B2 28.00 
3/11-3/17/45 16 14 32.38 
3/18-3/24/45 36 oy 66.94 
3/25-3/31/45 40 29 73.06 


4/ 1-4/7 7/45 40 28.5 72.41 


50 Glens Falls Indemnity Co. vs. 


Rate of Pay Changed to: Regular Time, $.90; Overtime, $1.35 


Hours Worked Gross 

Period Regular Overtime Wages 

4/ 8-4/14/45 40 28.5 74.48 
4/15-4/21/45 24 125 38.48 
4/22-4/28/45 40 30.5 77.18 
4/29-5/ 5/45 40 30.5 77.18 
5/ 6-5/12/45 40 20 72.45 
5/13-5/19/45 24 16.5 43.88 
Total) ccc. $ 713.54 


Employee: Tomany, Don. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
2/18-2/24/45 40 98 $ 187.00 
2/25-3/ 3/45 40 29 83.50 
3/ 4-3/10/45 24 We 49.50 
5/11-5/17/45 28 11 44.50 
3/18-3/24/45 40 35.5 93.25 
3/25-3/31/45 40 38 97.00 
4/ 8-4/14/45 40 65 137.50 
4/15-4/21/45 24 40.5 84.75 
4,/22-4/28 /45 40 39.5 99.25 
4/29-5/ 5/45 40 35 92.50 
5/ 6-5/12/45 24 11 40.50 
(6h | ORROPRC SS 0 oes) ee 2 $1,009.25 


Employee: Smith, Jim. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 
Period Regular Overtime Wages 
2/18-2/24/45 8 16 $ 32.00 


Basich Brothers Construction Co. 51 


Employce: Burehfield, Clyde. Oceupation: Crusher Operator 
Rate of Pay: Regular Time, $1.375; Overtime, $2.0625 


Hours Worked Gross 

Period Regular Overtime Wages 
2/25-3/ 3/45 10 13 $ 40.56 
3/ 4-3/10/45 32 12 68.75. 
3/11-38/17/45 24 31.5 OTT 
3/18-3/24/45 34 35 118.94 
3/25-8/31/45 40 55 168.44 


Occupation Changed to: Crusher Foreman 


Rate of Pay Changed to: Regular Time, $1.75; Overtime, $2.625 


Hours Worked Gross 
Period Regular Overtime Wages 
4/ 14/ 7/45 40 42.5 $ 181.56 
4/ 84/14/45 40 52.5 207.81 
4/15-4/21/45 32 38.5 157.06 
4/22-4/28/45 40 30.5 150.06 
4/29-5/ 5/45 40 51 203.88 
5/ 6-5/12/45 16 i 62.13 


Occupation Changed Back to: Crusher Operator 


Rate of Pay Changed Back to: Regular Time, $1.375 ; 
Overtime, $2.0625 


Hours Worked : Gross 


Period Regular Overtime ' Wages 
5/20-5/26/45 16 5 $ 32.31 
Hcy tetll Meee ce Oo cio $1,489.47 


Employee: Gorby, Clifford. Occupation: Oiler 
Rate of Pay: Regular Time, $.975; Overtime, $1.4625 


Hours Worked * Gross 

Period Regular. Overtime: .i ++ -: Wages 
2/25-3/ 3/45 34.5 it $ 58.50 
3/ 4-3/10/45 10 z Te 
3/18-3/24/45 31 18.5 ee e298 


3/25-3/31/45 8 5 511 


lie! ae _. $ 140.65 


52 Glens Falls Indemnity Co. vs. 


Employee: Scott, Dallas. Occupation: Tractor Operator 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Hours Worked Gross 


Period Regular Overtime Wages 
2/25-3/ 3/45 32 19 $ 90.75 
3/ 43/10/45 40 33.5 135.38 
3/11-3/17/45 30.5 4.5 100.88 
3/18-3/24/45 205) 37 127.50 
3/25-3/31/45 Bal 41 138.75 
4/ 1-4/ 7/45 32 41 140.25 
4/ 8-4/14/45 40 26 118.50 
4/15-4/21/45 40 a) 125.25 

Total... eee ee $ 977.26 


’ Employee: Shrader, Jim. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
2/25-3/ 3/45 40 76 $ 154.00 
Motal 23c:c30 ee $ 154.00 


Employee: Rutherford, Arthur. Occupation: Tractor Operator 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Hours Worked Gross 

Period Regular Overtime Wages 
2/25-3/ 3/45 20 13 $ 59.25 
TOR A eo ees en... 5 $ 59.25 


Employee: Sehellhase, Frank. Oceupation: Truek Driver 
Rate of Pay: Regular, $1.00; Overtime, $1.50 


Hours Worked Gross 
Period Regular Overtime Wages 


2/25-3/ 3/45 4.5 $ 4.50 


Basich Brothers Construction Co. 53 


Employee: Serventi, Lucien A., Jr. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
3/ 4-3/10/45 24 5 $ 24.75 
el cc cc Aes, eect Eke Sem 24.75 


Employee: Mosley, Thamor O. Occupation: Shovel Operator 
Rate of Pay: Regular Time, $1,625; Overtime, $2.4375 


Hours Worked Gross 

Period Regular Overtime Wages 
3/11-3/17/45 40 $ 65.00 
3/18-3/24/45 36.5 22.5 113.93 
3/25-3/31/45 40 22.5 119.84 
4/ 1-4/ 7/45 36 33 138.94 
4/ 8-4/14/45 40 34.5 149.09 
4/15-4/21/45 34 22.5 110.09 
4/22-4/28 /45 40 35.5 151.53 
4/29-5/ 5/45 40 38.5 158.84 
5/ 6-5/12/45 32 31.5 128.78 
5/13-5/19/45 40 34 147.88 
5/20-5/26/45 40 22.5 119.84 
5/27-6/ 2/45 32 41 153.16 
6/ 3-6/ 9/45 40 21 116.19 


SNC Ee noc nT $1,673.11 


54 Glens Falls Indemnity Co. vs. 


Employee: Wailes, Stacey. Occupation: Oiler 
Rate of Pay: Regular, $.975; Overtime, $1.4625 


.t Hours Worked Gross 

. Period Regular Overtime Wages 
3/11-3/17/45 32 $ 31.20 
3/18-3/24/45 36.5 26 73.62 
3 /28-3/31/45 40 22.5 71.91 
4/ 14/ 7/45 40 33 87.26 
4/ 8-4/14/45 32 34 80.93 
4/15-4/21/45 40 24 74.10 
4 /22-4/28/45 32 29.5 74.34 
4/29-5/ 5/45 40 38 94.58 
5/ 6-5/12/45 32 31.5 717.27 
5/13-5/19/45 40 34 88.73 
5 /20-5/26/45 32 20.5 61.18 
0/21-6/ 2/45 eae 39.5 88.97 
6/ 3-6/ 9/45 40 21 69.71 
po | GRO rei noel er, yl OEE co $ 973.80 


Employee: Paco, Raymond. Occupation: Laborer 
Rate of Pay: Regular, $.875; Overtime, $1.3125 


Hours Worked Gross 

Period Regular Overtime Wages 
3/11-3/17/45 32 15 $ 47.69 
3/18-3/24/45 24 25 53.81 
3/2523 731/45 28 23 54.69 
Akt). ?) | nr mnEeMPre sete: <C.Pee ene $ 156.19 


Employee Acosta, Antonia A. Occupation: Laborer 
Rate of Pay: Regular, $.875; Overtime, $1.3125 


Hours Worked Gross 
Period Regular Overtime Wages 


3/18-3/24/45 20 3 $ 21.44 


Basich Brothers Construction Co. 5D 


Employee: Collins, Charles. Occupation, Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1:50 


Hours Worked Gross 
Period Regular Overtime - Wages 

3/18-3/24/45 17.5 9 $ ° 31.00 
3/25-3/21/45 28 18.5 55.75 
4/ 1-4/ 7/45 36 14.5 576 
4/ 8-4/14/45 16 17 41.50 
4/15-4/21/45 34 21 65.50 
4/22-4/28/45 16 13.5 36.25 
4/29-5/ 5/45 36 35.5 89.25 
5/ 6-5/12/45 36 24 72.00 
5 /13-5/19/45 36 12 54.00 
5 /20-5/26/45 40 18 67.00 
5/27-6/ 2/45 24 34 75.00 
6/ 3-6/ 9/45 40 12 : 58.00: 

INCL peeescee sa yee rs eee ne ee RAP. $ 703.00 


Employee: Cosillo, Jose A. Occupation: Laborer 
Rate of Pay: Regular Time, $.875; Overtime, $1.3125 


7 Hours Worked Gross 

Period Regular Overtime Wages 
3/18-3/24/45 11.5 $ 10.06 
3/25-3/31/45 36 26.5 66.28 
4/ 1-4/ 7/45 40 29 73.06 
4/ 8-4/14/45 40 28.5 72.41 


Rate of Pay Changed to: Regular Time, $.90; Overtime, $1.35 


Hours Worked Gross 

Period Regular Overtime Wages 
4/15-4/21/45 30 13 $ 44.55 
4/22-4/28/45 = A 31 77.85 
4/29-5/ 5/45 40 33.5 81.23 
5/ 6-5/12/45 24 16 43.20 


SR le $ 468.64 


56 Glens Falls Indemnity Co. vs. 


Employee: Collins, Earl. Occupation: Truek Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked Gross 

Period Regular Overtime Wages 
3/18-3/24/45 2? 10 $ 37.00 
3/25-3/31/45 28 18.5 55.75 
4/ 1-4/ 7/45 36 26.5 75.15 
4/ 8-4/14/45 24 17.5 50.25 
4/15-4/21/45 34 215 66.25 
4/22-4/28/45 24 23.5 59.25 
4/29-5/ 5/45 40 34.5 91.75 
5/.6-5/12/45 36 24 72.00 
5 /13-5/19/45 28 20 58.00 
5,/20-5/26/45 40 18 67.00 
5/27-6/ 2/45 32 30 77.00 
6/°3-6/ 9/45 40 18 67.00 
oi 1025 PRA 2 Se OMB MP OEE $ 777.00 


Employee: Gatlin, Cecil L. Occupation: Truck Driver 
Rate of Pay: Regular Time, $1.00; Overtime, $1.50 


Hours Worked * Gross 

Period Regular Overtime Wages 
3/18-3/24/45 22 10 $ 37.00 
3/25-3/31/45 28 18.5 55.75 
dimes) 7/46 36 26.5 75.15 
4/ 8-4/14/45 4 17.5 50.25 
4/15-4/21/45 18 18.00 
4/29-5/ 5/45 16 12.5 34.75 
5/ 6-5/12/45 24 14 45.00 
5/13-5/19/45 40 16.5 64.75 
0/20-5/26/45 40 18 67.00 
5/21-6/ 2/45 32 14 53.00 
6/ 3-6/ 9/45 40 18 67.00 


wat andeneeRare te: eee sath 05.2 eee ee as $ 568.25 


Basich Brothers Construction Co. 57 


Employee: McDaniel, Leslie. Occupation, Tractor Operator 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Hours Worked Gross 


Period Regular Overtime Wages 
2/11-2/17/45 4 $ 6.00 
2/18-2,/24/45 4 6.00 

Say i ee ee ne eer en $ 12.00 


*[ Written Notation |: Eliminate. 
Labor Borrowed from Basich Brothers 


Employee: McCoy, Rex. Occupation: Maintainer Operator 
Rate of Pay: Regular Time, $1.50; Overtime, $2.25 


Period Regular Overtime Wages 
Hours Worked Gross 
9/18-2/24/45 22.5 $ 33.75 
“Nona Paige ss eels alee nA eee 5 Cohen eee $ 33.75 


*/ Written Notation | : Eliminate. 


Labor Borrowed from Basich Brothers 


SCHEDULE It 


Payroll. Pioneer Crusher. 3/25/45 to 6/9/45. 
$8,240.54. 


SCHEDULE III 


Payroll. Pioneer Crusher. 6/9/45 to 9/22/45. 
$12,172.04. 


SCHEDULE IV 


Payroll. P.D.O.C. Crusher. 6/3/45 to 7/7/45. 
$3,250.01. 


SCHEDULE V m 


Payroll. Hot Plant—Sand. 6/9/45 to 9/22/45. 
$2,888.92. 


58 Glens Falls Indemnity Co. vs. 


. SCHEDULE VI 
Insurance 2/17/45 to 9/22/45, $7,958.00 


Labor and Insuranee** 


Week Ending Labor Insurance 
2/17/45 $ 565.14* $ 59.29 
2/24/45 1,727.15* 176.77 
3/ 3/45 1,770.87* 183.14 
3/10/45 1,339.23* 141.47 
3/17/45 1,403.78* 151.10 
3/24/45 1,956.68* 205.30 
3/31/45 2,514.00* 270.95 

=A/ 7/45 3,132.91* 348.03 
4/14/45 3,704.83* 413.71 
4/21/45 3,130.53* 345.77 
4/28/45 3,016.26* 332.35 
5/ 5/45 4,522.19 545.44 
5/12/45 4,563.10 549.55 
5/19/45 3,603.47 438.89 
5/26/45 3,523.02 415.55 
6/ 2/45 3,564.49 421.78 
6/ 9/45 3,517.01 421.04 
6/16/45 2,648.23 334.05 
6/23/45 2732.51 341.64 
6/30/45 2473.40 319.11 
T/ 7/45 2,027.95 279.65 
7/14/45 1,420.86 182.41 
7/21/45 1,447.18 184.63 
7/28/45 1,358.39 172.00 
8/ 4/45 1,431.46 175.58 
8/11/45 958.00 124.59 
8/18/45 102.54 11.16 
8/25/45 1,000.64 135.72 
9/ 1/45 885.39 112.36 


9/ 8/45 667.09 83.49 


Bastch Brothers Construction Co. 59 


Week Ending Labor Insurance 
9/15/45 $ 187.89 $ 24.65 
9/22/45 433.87 56.47 

Mota ee os eeeecs, $67,330.06 $7,958.00 
*Differential in 5506 and 1710 rate in hae 
(PO IQO INS. 256 eee cele 1,258.51 
$9,216.51 


**Insurance includes Compensation, Public Liability, Property 
Damage, California Unemployment, Federal Old Age and 
Federal Excise. 


SCHEDULE VIT. 


Equipment Rental. Fully Operated. Basich Broth- 
ers Construction Co., 2/12/45 to 5/19/45, 
$3,989.41 . 7 

Rental of Equipment by 


Basich Brothers Construction Company Fully Operated 
Owner of Equipment—Basich Brothers Construction Co. 


Date Description Total Hours. Rate at 
2/12 IDES) Cie) oan eee 4 3 9. 375 pa 50 
2719 Tractor W/PCU ........ 4 ee 8.458: - 338.80 


2/20 Tractor W/PCU ........ 6.5. 8.45:. 54.93 
221 Tractor W/PCU ........ oe 8.45 |; : 67.60 
2/22 D8 Traetor W/PCU.... 8 8.45 67.60 
2/26 Truck Semi No. 44...... 5 = 7-00 ; 35.00 
2/28 Welding Truck .......... 8 ome begoe 54.80 

Welding Truck .......... Dag: 8225 p 24.11 

Dee ozer ....22....222.:.... 6 2. 8.45 : 50.70 
4 6.00 — 24.00 
3/5 N.W. 80 Shovel............ Ne es : 191.10 
3/6 N.W. 80 Shovel............ 6 «e 1822 109.32 
3/7 Welding Truck .......... 8 6,85. 54.80 
, Welding Track .......... 2 ayn: Si225 .' 16.45 
3/8 N.W. 80 Shovel............ 8 2 #182204 145.76 


AOS ry sot 


60 


Date 
3/9 

3/11 
3/14 
3/15 
3/16 
3/17 
3/19 
3/20 
3/20 
3/21 
3/21 
3/28 
3/29 
3/30 
3/31 
4/1 
4/2 
4/ 3 
4/4 
4/5 
4/ 6 


4/7 
4/9 


4/10 


4/11 


4/12 


Glens Falls Indemnity Co. vs. 


Description 


N.W. 80 Shovel...........- 
N.W. 80 Shovel............ 
Welding Truck .......... 
N.W. 80 Shovel............ 


D8 Dozer 
Maintainer 


Welding Truck .:........ 
Weldme Truck =. 
Welding Truck .......... 
Welding Truck .......... 
Welding Truck .......... 
Welding. Trucks... 
Welding Truck .......... 
Welding Truck ........-. 
Welding Truck .......... 
Welding Truck .......... 


Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 


Dozer 342 
Dozer 342 
Dozer 342 
Dozer 342 


bet 


pA 
WOW DINAN wAWNMmANANwAAANWNATDONDANAAATH NW © 


Total Hours 


He Cm fo Cc 


Rate 


18.22 
20.34 
8.225 
20.34 
10.20 
6.50 
6.85 
6.85 
8.225 
6.85 
8.225 
6.85 
8.225 
6.85 
6.85 
6.85 
9.375 
10.20 
9.375 
10.20 
10.20 
10:20 
9.375 
10.20 
9.375 
10.20 
9.375 
10.20 
9.375 
10.20 
9.375 
10.20 
10.20 
9.375 
10.20 
9.375 
10.20 
12.50 
9.375 
10.20 
9.375 
10.20 


Amount 


$145.76 
40.68 
86.36 
172889 
102.00 
6.50 
54.80 
13.70 
57.58 
54.80 
32.90 
54.80 
20.56 
27.40 
47.95 
41.10 
75.00 
20.40 
75.00 
20.40 
102.00 
102.00 
75.00 
30.60 
75.00 
86.70 
75.00 
20.40 
75.00 
20.40 
75.00 
20.40 
132.60 
75.00 
20.40 
75.00 
20.40 
62.50 
75.00 
35.70 
75.00 
30.60 


Basich Brothers Construction Co. 61 


Date Description Total Hours Rate Amount 


4/12 Mi 6 Shovel... 4 11.725 $46.90 
4/13 [DOVAETe oe 24 eee oe 6 9.375 56.25 
4/14 [DICE 31:4 ae eeeenreee 5) 10.20 51.00 
4/18 NW. 6 Shovel............ + 11.725 46.90 
4/19 Wozer gata) q...:.....-2scess: 8 9.375 75.00 
4 
8 


4/19 WGZE O42) .....-ccsuseceses-es 10.20 40.80 
4/20 (OG pee Ge. 9.375 75.00 
ioe 2s? a eee 2D 10.20 25.50 

4/21 CEA ST ca 92a 10 10.20 102.00 
0/15 Mbit OTANG 22.22. 2.c00: 1 12.50 2250 
3/17 Menke @ Fame. 22.-..2.2..5 2.5 12.50 31.25 
5/18 Mirch Crane ......--c.-<- LS 12.50 18.75 
opie Truck Crane ............---- 2.5 14.05 35.13 
IDG 22) ae i) 10.20 5.10 
Mournapull, ..........:.-...-: a 11.825 ool 
Mearmtainer sees 2 7.33 3.67 

A DGRIGI UURUESC cos Seen te eae er ee $3,989.41 


SCHEDULE VIII 


Equipment Rental. Not Fully Operated. Basich 
Brothers Construction Co., 3/29/45 to 6/9/45, 
$2.773.86 


Rental of Equipment by Basich Brothers Construction 
_ Company Not Fully Operated 
Owner of Equipment—Basich Brothers Construction Company 


Description From To Rate Amount 
Symons Sereen 3x10 .......... 3/29/45 6/9/45 175.00 $414.13 
Hieetric Motor ..................-. 3/29/45 6/9/45 15.00 35.50 
Conveyor 22” x 65’.............. 3/29/45 6/9/45 65.00 153.87 
Symons Sereen .................. 4/ 4/45 6/9/45 175.00 379.15 
Symons Screen ...............- 4/ 6/45 6/9/45 175.00 367.49 
Electric Motor ...................- 4/ 4/45 6/9/45 15.00 32.50 
Electric Motor .................... 4/ 6/45 6/9/45 15.00 31.50 
Sonweyor 30 fe... 4/ 4/45 6/9/45 65.00 140.85 


D-17000 Generator 
Bunker 
Bunker 


oe 3/29/45 6/9/45 445.00 1,053.13 
a 3/29/45 6/9/45 35.00 82.87 
Pot... 3/29/45 6/9/45 35.00 82.87 


a oes cs I ncn, $2,773.86 


62 . Glens Falls Indemnity Co. vs. 


SCHEDULE IX 


Equipment Rental. Royalty Basis. Basich Brothers 
Construction Co., $4,191.60 
Rental of Equipment on Royalty Basis 
Owner of Equipment—Basich Brothers Construction Company 


Description Quantity Rate Amount 


Pioneér Crusher (Rock Base) 7,102 cu. yds..$0.10 $ 710.00 
Pioneer Crusher (Min. Ager.) 6,071 tons ...... 0.10 607.10 
Pioneer Crusher (Cone. Aggr.) 27,750 eu. yds.. 0.10 2,775.00 
Hot Plant (Sand) 995) tonsa 0.10 99.50 


Total ......... $4,191.60 


SCHEDULE X 


Equipment Rental. Fully Operated. P. D. O. C., 
2/12/45 to 5/19/45, $6,902.37. Not Fully Oper- 
ated, 5/9/45 to 6/10/45, $261.34 

Rental of Equipment by Basich Brothers Construction Company 


From Others for Duque & Frazzini 


Owner of Equipment—P. D. O. C.—Rented Fully Operated 


Date Description Total Hours Rate Amount 
2/12/45 Toumti@erane ...........:. 5 10.00 $50.00 
2/19/45 Rau aGarnvall 22: + 025 24.10 
2/20/45 RK. U.. Camryadl. 2.2.25 6.5 6.025 39.16 
2/21/45 Re U, Cammyall -.....:.. 8 6.025 48.20 
2/22/45 he US Catal. .......... 8 6.025 48.20 
2/26/45 Tourmagrane ............. 5 10.00 50.00 
3/ 8/45 Dozer 0g. gwen. 2... 8 Oe 75.00 
3/14/45 Dozen sOle come: -.. YS 9.315 23.44 
3/15/45 Dever 2501 @...22........ 8 O 308 75.00 
3/16/45 Dozer, 50 lee. oe... ....... 5 9 31h 46.88 
B78/4A5 Dozer dO... oe. 9.5 910:20 96.90 
3/18/45 Dozer Wiles ee 2. 45 10.20 45.90 
3/19/45 Dozeme a0 ieee. .ge eee! 2 9.375 18.75 
3/20/45 Dozers 5 9.375 46.88 
3/21/40 Dozer SOIL... il 29.375 9.38 


Date 


3/24/45 
3/28/45 
3/29/45 
3/30/45 
4/ 5/45 
4/ 5/45 
4/ 8/45 
4/ 9/45 
4/ 9/45 
4/11/45 
4/11/45 
4/12/45 
4/12/45 
4/13/45 
4/13/45 
4/13/45 
4/13/45 
4/13/45 
4/14/45 
4/14/45 
4/15/45 
4/16/45 
4/16/45 
4/17/45 
4/17/45 
4/18/45 
4/18/45 
4/18/45 
4/19/45 
4/19/45 
4/19/45 
4/20/45 
4/20/45 
4/20/45 
4/21/45 
4/21/45 
4/22/45 
4/22/45 
4/23/45 
4/23/45 


Basich Brothers Construction Co. 


Description 


Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 


Dozer < 


Dozer 


Shovel 510 


Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 


428 


502 
502 
502 
428 
502 
502 
502 
502 
502 
428 
428 
502 
428 
502 
502 
502 
502 


5 


St etcccnerenccescs 


Total Hours Rate 


2 

1.5 
1.5 
1.5 


on ook 0 
tn tr tn nr a 


Foo OAN ®t oe ON Ow WH 


1) | 


—_ 
One WOW OF OOP DY ME 


10.20 
9.375 
9.375 
9.375 
9.375 

10.20 

10.20 
9.375 

10.20 
9.375 

10.20 
9.375 

10.20 
9.375 

10.20 


1288 — 


9.375 
10.20 
10.20 
10.20 
10.20 

9.375 
10.20 

9.375 
10.20 

9.375 
10.20 

9.375 

9.375 

9.375 
10.20 

9.375 
10.20 

9.375 
10.20 
10.20 
10.20 
10.20 

9.375 
10.20 


[ Written Notation—Bracketed ] $104.50. LRY, J. 


63 
Amount 


$20.40 
14.06 
14.06 
14.06 
(75.00 
145.90 
51.00 
75.00 
20.40 
75.00 
35.70 
75.00 
71.40 
75.00 
35.70 
55.71 
75.00 
51.00 
71.40 
107.10 
102.00 
75.00 
40.80 
75.00 
10.20 
75.00 
25.50 
42.19 
46.88 
75.00 
40.80 
75.00 
30.60 
46.88 
51.00 
122.40 
112.20 
51.00 
75.00 
45.90 


64 


Date 


4/23/45 
4/24/45 
4/24/45 
4/24/45 
4/25/45 
4/25/45 
4/25/45 
4/25/45 
4/26/45 
4/26/45 
4/26/45 
4/26/45 
4/26/45 
4/27/45 
4/27/45 
4/27/45 
4/27/45 
4/27/45 
4/28/45 
4/28/45 
4/28/45 
4/29/45 
4/29/45 
4/29/45 
4/30/45 
4/30/45 
5/ 1/45 
4/30/45 
5/ 1/45 
5/ 1/45 
5/ 2/45 
5/ 2/45 
5/ 2/45 
5/ 3/45 
5/ 3/45 
5/ 3/45 
5/ 4/45 
5/ 4/45 
5/ 4/45 
5/ 5/45 
5/ 6/45 


Glens Falls Indemnity Co. vs. 


Description 


Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 


Dozer < 


428 
502 
502 
428 
428 
322 
322 
502 
322 
322 
428 
428 
502 
322 
322 
428 
992 
592 
322 
428 
502 
502 
428 
322 
428 
502 
428 
502 
322 
322 
428 
322 
322 
322 
322 
428 
428 
322 
322 


Total Hours Rate 


5 


an 


Or 


On 


= 
jew) (sw) oS ow 


C2 CO 


2.5 


9.375 
9.375 
10.20 
9.375 
9.375 
9.375 
10.20 
9.375 
9.375 
10.20 
9.375 
10.20 
9.375 
9.375 
10.20 
9.375 
9.375 
10.20 
10.20 
10.20 
10.20 
10.20 
10.20 
10.20 
9.375 
9.375 
9.375 
10.20 
9.375 
10.20 
9.375 
9.375 
10.20 
9.375 
10.20 
9.375 
9.375 
9.375 
10.20 
10.20 


10.20 


Amount 


$46.88 
75.00 
5.10 
37.50 
37.50 
75.00 
20.40 
75.00 
75.00 
25.50 
75.00 
35.70 
79.00 
75.00 
39.70 
28.13 
75.00 
61.20 
102.00 
30.60 
102.00 
107.10 
30.60 
96.90 
28.13 
75.00 
28.13 
25.50 
75.00 
25.50 
37.50 
75.00 
25.50 
75.00 
25.50 
28.13 
56.25 
79.00 
40.80 
40.80 
40.80 


Date 


5/ 6/45 
5/ 1/45 
6/ 7/45 
5/ 1/45 
5/ 8/45 
5/ 8/45 
5/ 8/45 
5/ 9/45 
5/ 9/45 
5/ 9/45 
5/10/45 
5/10/45 
5/10/45 
5/11/45 
5/11/45 
5/11/45 
5/12/45 
5/13/45 
5/14/45 
5/14/45 
5/15/45 
5/15/45 
5/16/45 
5/16/45 
5/16/45 
5/16/45 
5/17/45 
5/17/45 
5/18/45 
5/18/45 
5/19/45 


Description 


D-13000 Power Unit 


Basich Brothers Construction Co. 


Description 


Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 


Dozer ¢ 


Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 
Dozer 


Equipment Rented Not Fully Operated 


Ba 2 12 
A oe 7 
Ss a. Ae 8 
SE ee Oe 4.5 
Pe pe eee 8 
428) 222.5... 4) 
St ae eee 2 
128. ee. 8 
48... 4 
Pe sae Gas szccees 2.5 
Ao) axa 8 
OE so nsec 4.5 
22) |e 2 
ts) ee 8 
A) re 4 
Po re 2 
10s.) es 8.5 
2) 13 
Bio 8 
US) 2.5 
AS) (2 5 na 8 
1) oe 2.5 
i a 8 
BP a 2.0 
12S) re 8 
dCs a 4 
2s) 8 
de on 4.5 
17a. 8 
1. 3 
2c 4.5 


Pee wet em am ae ae wenn wesw cess ewww en see e eee e cea a seen eae eees 


From 


Total Hours Rate 


10.20 
9.375 
9.375 

10.20 
9.375 

10.20 
9.375 
9.375 

10.20 
9.375 
9.375 

10.20 
9.375 
9.375 

10.20 
9.375 

10.20 

10.20 
9.375 

10.20 
9.375 

10.20 
9.379 

10.20 
9.375 

10.20 
9.375 

10.20 


Rate 


65 


Amount 


$122.40 
37.50 
75.00 
45.90 
75.00 
51.00 
18.75 
75.00 
40.80 
23.44 
75.00 
45.90 
18.75 
75.00 
40.80 
18.75 
86.70 
132.60 
75.00 
25.50 
75.00 
25.59 
75.00 
25.50 
75.00 
40.80 
75.00 
45.90 
75.00 
30.69 
45.90 


$6,902.37 


Amount 


ee . 5/9/45 6/10/45 245.00 $261.34 


66 


Equipment Rental. 


Date 


2/21/45 
2/22/45 
2/23/45 
2/24/45 
2/26/45 
2/27/45 
2/28/45 
3/ 1/45 
3/ 2/45 
3/ 3/45 
3/26/45 
3/29/45 
3/30/45 
3/31/45 
4/ 1/45 
4/ 2/45 
4/ 3/45 
4/ 4/45 
4/ 5/45 
4/ 6/45 
4/ 7/45 
4/ 9/45 
4/10/45 
4/11/45 
4/18/45 
4/14/45 
4/16/45 
4/17/45 


4/18/45 
4/19/45 


Glens Falls Indemnity Co. vs. 


SCHEDULE XI 
Fully 


Owner of Equipment—J. J. North & Sons 


Description 


North 5 yd. Dump.... 
De yee OATS it 
Savde Dumps cnn. 
5 gal, Dump................ 
mal. DUM. .2-c.cc.e- 
Do yoo Wumiplsccs:.:.: 
5) vides Dima [year -ce:-:-~.-- 
Wee Ce) cee 
5 
5 


nn 


00 | BCH 01) 0 eee 
HV Glew W) Ui OME. -.ccce ede ce 
Waineh Truck ............ 
5 Cw 


wt Ot at ON 
ee 
SS a 
= 
(ea 
5 
~S 


on 
el 
8, 
= 
S 
= 

iS 


Or or Ot OFT st Or or ON 


6 yd. Wrnpe...... 
Bele JUNI ee 


5 yd. Wrecks 2.2.2... 
o yd. Micke 2.2. 


Operated by SBasich 
Brothers, J. J. North & Sons. 2/21/45 to 6/6/45, 
$4,956.06 

Rental of Equipment by Basich Brothers Construction Co. 


From Others for Duque & Frazzini 
Fully Operated by Basich Brothers 


Total Hours 


5D 

3.5 
6 

6.5 
6.5 
8.5 
8.5 


Rate 


4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
3.00 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.13 
4.40 
4.13 
3.00 
4.13 


4.13 . 


Amount 


$20.65 
14.46 
24.78 
26.85 
26.85 
35.11 
39.11 
4.13 
35.11 
37.17 
16.50 
165.20 
324.21 
315.95 
390.29 
227.15 
76.41 
293.23 
134.23 
297.36 
332.47 
159.01 
72.28 
DO ll 
14.46 
22.72 
4.40 
82.60 
6.00 
165.20 
88.80 


Date 


4/20/45 
4/21/45 


4/22/45 
4/23/45 


4/24/45 
4/25/45 
4/26/45 


4/27/45 


4/28/45 
4/29/45 


4/30/45 


5/ 1/45 


5/ 2/45 
5/ 2/45 
5/ 3/45 
5/ 4/45 
5/ 1/45 
5/ 8/45 
5/11/45 
5/14/45 
5/18/45 
5/19/45 
5/20/45 
5/22/45 
5/25/45 
6/ 6/45 


Basich Brothers Construction Co. 


Description 


OCs WU CES occa cosas 
Wineh Truck ............ 
vd, ‘Pruek: 225.22 
cle (ti O 
700 gg (6) ie nM 


Re WUC Kies secc.205-cce 
melaek.......ee 
Von i raek 2 ..........- 
pile Wregeh.c<<..eccts.s0x 


MN Ng cng 
te 
Qu 


oeyd. Dumps............. 
O yd. Dumps.......:---.. 
Wien Trick ..........-. 
Dey, TOWMS..02<..:c..2. 
Gevd. Dunms..:222...:. 
Seed. Wms 2.2%.--.:... 
Gryd, Dumps.............. 


Winch Truck ............ 
5 yd. 
6 yd. 
5 yd. 
6 yd. 
5 yd. 


oO yd. Tiruiens............: 
DyeVCl we UIGIC IOS ee 25 2. 
Waineh Giiek =......... 


Wineh Truek 0.00... 
5 yd. Truceks.............. 
Wineh Truck 
Winch Truck 
Wineh Truck 
Winch Truck 


wae eerenewee 


eee eee aoe 


Total Hours 


27 


ee) 


oO 


Rate 


4.13 
3.00 
4.40 
4.13 
4.13 
4.40 
4.13 
4.13 
4.18 
4.13 
3.00 
4.13 
4.40 
3.00 
4.13 
4.40 
4.15 
4.40 
3.00 
4.18 
4.40 
4.13 
4.40 
4.13 
3.00 
4.13 
4.13 
3.00 
4.13 
4.13 
3.00 
3.00 
4.13 
3.00 
3.00 
3.00 
3.00 


Olt ee ee eee 


67 


Amount 


$111.51 
6.00 
44.00 
alge gal 
2.07 
39.60 
94.99 
8.26 
30.98 
14.46 
24.00 
101.19 
35.20 
4.50 
152.81 
52.80 
144.55 
52.80 
6.00 
49.56 
52.80 
41.30 
50.60 
12.39 
9.00 
12.39 
8.26 
7.50 
4.13 
16.52 
4.50 
6.00 
24.78 
30.00 
7.50 
4.50 
4.50 


$4,956.06 


68 Glens Falls Indemnity Co. vs. 


SCHEDULE XII 


Equipment Rental. Fully Operated. B. B. Bonner, 
4/6/45 to 4/24/45, $625.74 


Rental of Equipment by Basich Brothers Construction Company 
From Others for Duque & Frazzini 


Owner of Equipment: B. B. Bonner—Rented Fully Operated 


Date Description Total Hours Rate Amount 
5/ 6/45 Doig Doze 22s. 2 7.075 $15.15 
4/ 9/45 DiveWozer 2. 1 7.975 7.58 
4/10/45 Det D0z Grp ere esos 8 7.575 60.60 
AVi0/15  DejaDozee ees 2 8.40 16.80 
4/11/45 Dee Dozer 2 2... 8 7.575 60.60 
4/11/45 Daim ozerne...).: I 8.40 8.40 
4/12/45 D)- V2 D0zer a. 3 7.579 22.73 
aoa me Dozer 8 7.575 60.60 
4/14/45 Det 2Dozer Wee..c2..s-:.. 10 8.40 84.00 
4/16/45 =f Wozer Wee..c 2... 8 7.575 60.60 
4/16/45 GG = | Yoy.ss) ae. | eee 3.0 8.40 29.40 
Wyss Veen Dozer ccc... 95 7.575 18.94 
4/22/45 = D-T Dozer ceeccsecceecceeens 12 8.40 100.80 
4723745 Dre Dozer _........ 8 7.575 60.60 
4/24/45 OSTEO OZER? conc. ce 8) 7.975 18.94 

NOTA oo sovsvadeaes ccccastaxiancss eee $ 625.74 


SCHEDULE XIIT 


Equipment Rental. Not Fully Operated. Bressi 
& Bevanda. 4/24/45 to 6/9/45, $582.72 
Renta! of Equipment by Basich Brothers Construction Company 


From Others for Duque & Frazzini 


Owner of Equipment—Bressi & Bevanda 
Rented Not Fully Operated 


Description From To Rate Amount 


D-18000 with Generator.... 4/24/45 6/9/45 380.00 $582.72 


Basich Brothers Construction Co. 69 
SCHEDULE XIV 


Equipment Rental. Not Fully Operated. Industrial 
Equipment Co., 4/6/45 to 5/8/45, $176.00 


Rental of Equipment by Basich Brothers Construction Company 
~ From Others for Duque & Frazzini 


Owner of Equipment—Industrial Equipment Co. 
Rented Not Fully Operated 


Description From To Rate Amount 


McCormick-Deering 
Brower: UNI cai. eee 4/6/45 5/8/45 165.00 $176.00 


SCHEDULE XV 


Equipment Rental. Fully Operated. Basich Broth- 
ers Construction Co., 6/9/45 to 9/16/45, 
$18,485.17 


SCHEDULE XVI 


Basich Brothers Construction. Equipment Rental. 
Not Fully Operated. 6/9/45 to 9/8/45, $2,849.56 


SCHEDULE XVII 


Basich Brother Construction Co. Equipment 
Rental. Royalty Basis, $6,753.20 


Rental of Equipment by Basich Brothers Construction Company 
on Royalty Basis 


Description Tonnage Rate Amount 
Pioneer Crusher (Base)...................-.. 6036 0.10 $603.60 
Pioneer Crusher (Min. Agegr.).......... 19,283 0.10 1,928.30 
Pioneer Crusher (Cone. Agegr.).......... 39,990 0.10 3,999.00 
How Plant (Sand) ....2..:.......2..22... 223 0.10 222.30 


otros 8 ee $6,753.20 


70 Glens Falls Indemnity Co. vs. 
SCHEDULE XVIII 


Equipment Rental. Not Fully Operated. P. D. O. C., 
6/15/45 to 9/17/45, $108.50 


SCHEDULE XIX 


Equipment Rental. Fully Operated. P. D. O. C., 
6/9/45 to 9/6/45, $10,412.57 


SCHEDULE XX 


Equipment Rental. Royalty Basis. 
P. D. O. C., $5,349.73 


Rental of Equipment by Basich Brothers Construction Company 
From Others for Duque & Frazzini 


Owner of Equipment: P. D. O. C.—Royalty Basis 
Description Tonnage Rate Amount 


P.D.O.C. Pioneer Crushev.......... 23602 tons 0.17 $5,349.73 
(31469) loose 
SCHEDULE XXI 


{quipment Rental. Fully Operated. J. G. North 
& Sons. 6/8/45 to 9/12/45, $27,809.54 


SCHEDULE XXII 


Equipment Rental. Fully Operated. Phoenix Tempe 
Stone Co. 6/15/45 to 8/9/45, $6,102.05 


SCHEDULE XXIII 


Equipment Rental. Not Fully Operated. Bressi 
& Bevanda. 6/9/45 to 9/10/45, $1152.61 


Basich Brothers Construction Co. 71 
SCHEDULE XXIV 


Equipment Rental. Not Fully Operated. Martin 
Construction Co. 6/15/45 to 9/8/45, $270.00 


SCHEDULE XXV 


Equipment Rental. Not Fully Operated. Axman- 
Miller Construction Co. 7/6/45 to 9/17/45, $700.00 


SCHEDULE XXVI 


Repairs Made by Others on Basich Brothers Con- 
struction Co. Equipment. Not Fully Operated, 
$275.51 


SCHEDULE XXVITI 


Parts Purchased for Basich Brothers Construction 
Co. Equipment. Not Fully Operated. 2/14/45 
to 6/4/45, $2,257.88 


Parts Purchased for Basich Brothers Construction Co. 
Equipment Not Fully Operated 


Invoice 

Date Company Invoice No. Amount 
2/14/45 Abbey Scherer Co................. F-89 $ 82.13 
3/ 1/45 Abbey Scherer Co. ................ F-123 193.37 
3/ 2/45 Symons Brothers Screen Co. S-7419 160.72 
3/ 8/45 Abbey Scherer Co................. F-137 31.09 
3/24/45 Abbey Scherer Co................. F-176 176.45 
3/31/45 Abbey Scherer Co................. F-190 115.80 
4/ 2/45 Abbey Scherer Co................- F-194 62.10 
4/ 2/45 Victor Belting & Rubber Co. 6594 4.83 
4/ 6/45 Abbey Scherer Co................- F-202 174.67 
4/10/45 FF. Ronstadt Wu. A15095 10.44 
4/13/45 Symons Brothers Screen Co. $7502 37.67 


4/13/45 Symons Brothers Screen Co. 87503 80.36 


72 


Invoice 
Date 


4/13/45 
4/30/45 
5/ 4/45 
5/12/45 
5/ 1/45 
4/21/45 
4/30/45 
6/ 7/45 
6/ 4/45 


Glens Falls Indemnity Co. vs. 


Company 


Invoice No. 


Symons Brothers Sereen Co. 
Symons Brothers Sereen Co. 
Harron Rickard & MecCone.. 
Harron Rickard & MecCone.. 
Brown-Bevis Equipment Co. 


Abbey Scherer Co.......... 
Abbey Scherer Co.......... 
Abbey Scherer Co.......... 


Victor Belting & Rubber Co. 


$7503 
$7539 
50098 
50117 
74543 
F-245 
F267 
F-379 
8029 


SCHEDULE XXVIII 


Parts Taken From Basich Brothers 


Construction Co. Stock, $1,723.75 


SCHEDULE XXIX 


Amount 


$ 34.44 
139.14 
16.16 
174.59 
398.42 
34.09 
121.89 
57.90 
151.62 


$2,957.88 


Fuel, Grease and Oil on Equipment Not 
Fully Operated. 4/9/45 to 5/31/45, $732.47 


Date 


2/26/45 
2/28/45 
3/ 1/45 
3/ 2/45 
3/ 3/45 
3/ 4/45 
3/ 5/45 


SCHEDULE XXX 


Miscellaneous Labor, Invoices, Ete. 


2/26/45 to 6/16/45, $2,814.24 


Miscellaneous Labor, Invoices, Ete. 


Description 


Move & Set up Pioneer 


oe eé aé ce “6 


6é “é¢ ce eé é¢ 


Labor 


33.69 
41.60 
21.80 
29.60 
46.71 
46.71 
14.80 


Invoice 
Amount 


Ins. on 
Labor 


Date 


3/ 6/45 
3/ 7/45 
3/ 8/45 
3/ 9/45 
3/10/45 
3/11/45 
3/12/45 
3/13/45 
3/14/45 
3/15/45 
3/16/45 
3/17/45 
3/18/45 
3/19/45 
3/20/45 
3/21/45 
3/22/45 
3/27/45 
3/28/45 
3/29/45 
3/30/45 
3/31/45 
4/ 1/45 
4/ 3/45 
4/ 4/45 


4/ 6/45 
4/ 7/45 


4/ 9/45 
4/10/45 
4/11/45 


4/14/45 
4/18/45 


4/19/45 


Basich Brothers Construction Co. 


Description 


Move 
oe 


& Set Up Pioneer 


¢ e¢ oe eé¢ 


cé cé é¢ ce 


North Drivers Overtime 


ce 


éé 


Show up 
Overtime 


“é oe 
(a9 ce 


Downtime 


ae oe 
Overtime 
éé ee 
foes ce 


Downtime 


ce «é 


Overtime 


e¢ ce 


Downtime 


sé éé 


Overtime 
ge éé 

Show up 
Overtime 


“c bc 


Labor 


45.80 
52.59 
39.60 
80.65 
115.73 
142.20 
106.31 
98.44 
88.84 
91.46 
91.46 
74.64 
Or 
78.93 
72.97 
64.82 
46.64 
92.84 
113.82 
4.00 
2.00 
7.29 
39.02 
47.25 
9.50 
3.00 
7.00 
5.29 
40.25 
00 
1.00 
1.25 
20 
5.50 
1.50 
3.00 
2.75 
6.00 
4.00 
3.00 


Invoice 
Amount 


73 


Ins. on 
Labor 


74 Glens Falls Indemnity Co. vs. 


Invoice Ins. on 
Date Description Labor Amount Labor 
4/20/45 North Drivers Overtime 1.50 
4/21/45 cs a 20.00 
a ‘* — Downtime 1.50 
4/22/45 re ‘* Overtime 25 
4/23/45 i‘ iv < 1.50 
4/24/45 a ‘* Show up 6.00 
4/25/45 - be ee 6.00 
we ‘* Downtime 2.00 
‘5 ‘« — Overtime 20 
4/27/45 - am i 20 
4/28/45 ms ny Es 26.50 
ae ‘< ~ Downtime +.00 
4/29/45 i a a 3.00 
4/29/45 oe ‘* Overtime 23.50 
4/30/45 ve se ie 4.00 
4/30/45 Tucson Mac. E. Eng....... 121.88 
6/13/45 H.S.Thompson Exp. Ace’t. 49.69 
6/16/45 H.S. Thompson Exp. Ace’t. 235.53 
Phone Charges 2.222 92.30 
10% Insurance on labor 210.44 
NO WAN GW cece $2,104.40 $499.40 $210.44 
Cay ste lad M0) 2 | OO Rr oa eee $2,814.24 


SCHEDULE XXXI 
Freight on Rented Equipment, $326.89 


SCHEDULE XXXII 


Repairs Made by Others on Basich Brothers Con- 
struction Co. Equipment. Not Fully Operated. 
6/9/45 to 9/10/45, $3,969.97 


Basich Brothers Construction Co. 75 


SCHEDULE XXXIIT 


Parts Purchased for Basich Brothers Construction 
Co. Equipment. Not Fully Operated. 6/16/45 
to 9/18/45, $3,215.19 


SCHEDULE XXXIV 


Parts Taken From Basich Brothers 
Construction Company Stock, $1,028.91 


SCHEDULE XXXV 


Fuel, Grease and Oil on Equipment Not 
Fully Operated. 6/7/45 to 9/6/45, $1,371.50 


SCHEDULE XXXVI 


Miscellaneous Labor, Invoices, Ete. 
6/7/45 to 9/17/45, $4,803.15 


Miscellaneous Labor, Invoices, Ete. 


Invoice Ins. on 
Date Description Labor Amount Labor 
6/ 7/45 Move & Set up P.D.O.C. Plant 2,500.00 
6/ 9/45 as Drivers Overtime 17.00 
6/10/45 ‘* Overtime 43.75 
ci ‘< ~~ Downtime 40.00 
6/11/45 a ‘* Overtime 10.00 
i ‘* ~~ Downtime 11.00 
6/12/45 “ ‘* Overtime 14.00 
ie ‘* Downtime 14.50 , 
6/13/45 <i ‘“ Overtime 13:25 
is ‘* Downtime 13.50 
6/14/45 = ‘< Overtime 24.75 
oe ‘< Downtime 10.00 
6/15/45 ia ‘* Overtime 129 


Downtime 21.50 


76 


Date 


6/16/45 No 


6/17/45 
6/18/45 


6/19/45 
6/20/45 
6/21/45 
6/22/45 
6/23/45 
6/24/45 
6/25/45 
6/26/45 
6/27/45 
6/28/45 
6/29/45 
6/30/45 
7/ 1/45 
T/ 2/45 
1/ 3/45 


T/ 4/45 
T/ 5/45 


7/ 6/45 
7/7/45 


Glens Falls Indemnity Co. vs. 


Description 


‘ 


rth Drivers Overtime 
rg ce cé 


cé 


Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
4 
Downtime 


Overtime 
(4 


Labor 


77.50 
29.50 
17.75 
26.00 
21.75 
16.00 
21.00 

8.00 
22) 
.00 
.00 

4.50 
77.75 

7.50 
93.75 

5.50 
20.75 

4.50 
10.00 

6.00 
12.75 

9.00 
11.75 

1.00 
11.00 

2.50 
66.25 
33.50 
46.00 
11.50 
14.00 
33.00 
13.50 
27.50 
65.00 

8.50 
36.00 

9.00 
30.79 


NO Ww bo 
C © 


Invoice 
Amount 


Ins. on 
Labor 


Date 


7/ 8/45 


7/10/45 


7/11/45 
7/12/45 
7/13/45 
7/14/45 


7/15/45 


7/16/45 
T/17/45 


7/18/45 
7/19/45 
7/20/45 
7/21/45 
7/23/45 


7/24/45 
7/25/45 


7/26/45 
7/27/45 


7/28/45 
7/30/45 
8/ 2/45 
8/ 3/45 
8/ 4/45 
8/ 5/45 
8/ 6/45 


Basich Brothers Construction Co. 


Description 


North Drivers Downtime 


ae oe 


Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
arg 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
cé 
Downtime 
éé 
ce 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
Overtime 
Downtime 
(24 
Overtime 
Downtime 
Overtime 
ee 
Downtime 
Overtime 
Downtime 
Overtime 


ce 


Downtime 


Labor 


11.00 
45.00 
4.50 
9.00 
1.00 
3.00 
4.00 
11.00 
39.00 
13.00 
42.00 
24.00 
43.75 
4.00 
14.00 
12.00 
4.00 
25.00 
15.60 
13.50 
12.00 
8.25 
13.50 
52.00 
5.00 
9.25 
10.50 
10.00 
10.00 
41.50 
10.00 
10.00 
25.00 
15.00 
8.50 
9.09 
7.00 
34.75 
40.50 
7.75 
12.00 


Invoice 
Amount 


ia 


Ins. on 
Labor 


Date 


8/ 7/45 
8/ 8/45 


8/ 9/45 
8/18/45 
8/22/45 
8/23/45 
8/25/45 
8/26/45 
8/27/45 
8/28/45 
8/29/45 
8/30/45 
9/ 4/45 
9/ 6/45 


9/12/45 
9/17/45 


Glens Falls Indemnity Co. vs. 


Invoice Ins. on 
Description Labor Amount Labor 
North Drivers Overtime iD 
e¢ c¢ ee AS) 
ae ‘< ~ Downtime 8.00 
bi ‘¢ — Overtime 6.00 
ia ‘* ~~ Downtime 6.00 
st ‘* — Overtime 13.50 
a ‘< ~~ Downtime 3.00 
2 o 20.50 
‘* ~ Overtime 40.75 
" ‘* Downtime 9.90 
ee ‘< Overtime 39.00 
Se ‘* Downtime 3.50 
i ‘< Overtime Duo 
“< ‘* ~~ Downtime 3.90 
ee e¢ cé 3.50 
a ‘* — Overtime 10:25 
i ‘* ~~ Downtime 8.00 
= ‘*¢ ~ Overtime 8.25 
ns ‘* ~ Downtime 7.00 
ee * Overtime 6.10 
ce ce ce 4.75 
c¢ c¢ ce 2? 00 
Load Axman-Miller Sereen 17.00 
Ins. on Labor 
2103.75 @ 8.67 per hun. 182.40 
WN Re Por ee $2,103.75 $2,517.00 $182.40 
Greet OO eal 2 2c 2 ks se nena eee Sti $4,803.15 


SCHEDULE XXXVITI 
Freight on Rented Equipment, $663.39 


Basich Brothers Construction Co. 


Estimate Date 


3/31/45 
4/15/45 
4/30/45 
5/15/45 
5/31/45 
6/ 8/45 
6/15/45 
6/15- 6/30/45 
7/ 1- 7/15/45 
7/16- 7/31/45 
8/ 1- 8/15/45 


SCHEDULE XXXVIII 
Production. Gravel Base, $25,191.44 


Produection—Item 15 
Gravel Base 
Contract Price—$0.46 c.y. 


Quantity 


6,307 
11,662 
3,595 
11,140 
5,703 
533 
567 

2 986 
774 


6/15- 7/31 (Extension) 7,500 


8/ 1- 8/15/45 
8/16- 8/31/45 
8/ 1- 8/10/45 
8/31-10/ 8/45 


3,046 
(Extension) 75 
976 


c.y. 
C.y. 
C.y. 
C.y. 
Gy. 
C.y. 
C.y. 
C.y. 
C.y. 


Gy. 


C.y. 


C.y. 
C.y. 


54,764 cy. 


79 


Credit 


$2,901.22 
5,364.52 
1,653.70 
5,124.40 
2,623.38 
245.18 
214.82 
1,373.56 
356.04 


3,450.00 
1,401.16 


34.50 
448.96 


$25,191.44 


80 Glens Falls Indemnity Co. vs. 


SCHEDULE NX XIX 
Production. Gravel Stabilized Base, $4,109.20 


Production—Item 11 
Gravel Stabilized Base Contract Price—$0.40 c.y. 


Estimate Date Quantity Credit 
3/31/45 34,700 s.y. 
4/15/45 15,840 s.y. 
4/30/45 9.561 sy. 
5/15/45 33,256 s.y. 
5/31/45 20,448 s.y. 
6/ 8/45 33,903 s.y. 


6/15- 6/30/45 
T/ 1- 7/15/45 
7/16- 7/31/45 
8/ 1- 8/15/45 


8/16- 8/31/45 B09. 8.9. 
8/31-10/ 8/45 2,602 s.y. 
154,102 s.y 
or 
O27 ey. $4,109.20 


SCHEDULE XXXKX 
Production. Gravel Embankment, $4,719.60 


Production—Item 9 
Gravel Embankment 
Contract Price—0.46 c.y. 


Estimate Date Quantity Credit 
3/31/45 
4/15/45 500 e.y. $ 230.00 
4/30/45 500 c.y. 230.00 
5/15/45 2,000 e.y. 920.00 
5/31/45 
6/ 8/45 


6/15/45 


Basich Brothers Construction Co. 81 


Estimate Date Quantity Credit 
6/15- 6/30/45 1,900 c.y. $ 874.00 
7/ 1- 7/15/45 
7/16- 7/31/45 


8/ 1- 8/15/45 DUD CY. 2taa0 
8/16- 8/31/45 3,000 Cy. 1,640.36 
8/31-10/ 8/45 le One 551.54 

10,260 cy. $4,719.60 


SCHEDULE XXXXI 


Production. Concrete Aggregate, $70,710.52 


Production—Items 21 & 22 
Conerete Aggregate 
Contract Price—$1.05 c.y. 


Estimate Date Quantity Credit 
3/31/45 
4/15/45 O50 "ey, $ 2,761.50 
4/30/45 ela ay. 8,007.50 
5/15/45 2,600 cy. 2,730.00 
5/31/45 650) JIC y. O,1 12.07 
6/ 8/45 SUZ ey. 5,448.68 
6/15/45 4,540.57 ey. 4,767.60 
6/15- 6/30/45 oO, lbre x. Spel 
Uf IE) GyLS 3,000 CY. 3,020.65 
7/16- 7/31/45 
B/ 1- 8/15/45 4,828 cy. 5,069.40 
6/15- 7/31 
(Extension ) 10015. 208cy. 10,515.96 
8/ 1- 8/15/45 2253 e. 2,367.75 
8/16- 8/31/45 ZED (c.y: 3,096.45 
8/ 1- 8/10/45 
(Extension) 1,102.15 1,157.26 
8/31-10/ 8/45 O261 cy. 6,574.05 


Total 67,343.35 c.y. $70,710.52 


82 Glens Falls Indemnity Co. vs. 


SCHEDULE XXXXII 
Production. Mineral Aggregate, $15,377.93 


Production—Items 26A & 26B 
Mineral Aggregate 
Contract Price—$0.65 Ton 


Estimate Date Quantity Credit 
3/31/45 
4/15/45 
4/30/45 
9/15/45 4,827 tons § 3, lieteas 
5/31/45 
6/ 8/45 
6/15/45 
6/15- 6/30/45 
T/ 1- 7/15/45 5,731 tons 3, (2005 
7/16- 7/31/45 
8/ 1- 8/15/45 9,112 tons 5922720 
8/16- 8/31/45 
8/31-10/ 8/45 5,239.16 3,401.55 
24,903.16 tons 16,187.05 
Minus oil 1,244.81 Minus oil 809.12 
Total 23,658.35 tons $15,387 (oe 


SCHEDULE XXXXIIT 


Production. Concrete Aggregate for 
Structures, $405.30 


Produetion—Concrete Aggregate for Structures 
Contract Price—$1.05 c.y. 


Estimate Date Quantity Credit 
3/31/45 
4/15/45 
4/30/45 
5/15/45 20 ey. $21.00 


Basich Brothers Construction Co. 83 


Estimate Date Quantity Credit 
5/31/45 95 cy. $99.75 
6/ 8/45 
6/15/45 
6/15- 6/30/45 8.5 cy. 8.92 
G10 15/85 74.5 cy. 78.23 
7/16- 7/31/45 
6/15- 7/31/45 (Extension) 6 cy. 6.30 
8/ 1 8/15/45 122) e1y. 128.10 
8/16- 8/31/45 20 cy. 21.00 
8/31-10/ 8/45 40 ey. 42.00 

Total 386 c.y. $405.30 


SCHEDULE XXXXIV 
Miscellaneous Credits, $1,319.96 


Miscellaneous Credits 


Item Quantity Rate Credit 
Pawo tor seal (oat... ..--.-..-.2.0-..-.,. 751 tons $0.65ton $488.15 
Gravel Base Sold to A. C. LaRue 
Construction Co. for Strips 


Adjacent to Hanger ...._............. 390 c.y. 0.46 c.y. 179.40 
Gravel Base for 8’ CMP.............. 79 @.y. 0.46 c.y. 34.50 
Credit—Maintainer Rental.......... 925.00 
Creat liao .... cece cecceveecsecscese 200 

TROVE 0 Ge ee cae Panne $1,319.96 
Received copy of the within this .... day of.... 
1S ee 


J. E. MeCALL, 
By JOSEPH J. BURRIS, 


Attorney for Glens Falls 
Indemnity Company. 


[Endorsed]: Filed July 1, 1946. 


84 Glens Falls Indemnity Co. vs. 


[‘itle of District Court and Cause.] 


NOTICE TO PRODUCE 


‘To Basich Brothers Construction Company, a Cor- 
poration, Plaintiff, and to Stephen Monteleone, 
Hsq., Plaintiff’s Attorney: 


You Are Hereby Notified and Required to pro- 
duce at the pre-trial and also at the tial of the 
above-entitled cause, the following documents, 
to wit: 

1. Employer’s copy of all withholding returns 
with eopies of withholding receipts attached to any 
of said returns, which were filed with the Internal 
Revenue Department: covering employees [373] 
working on the alleged subcontract work of Duque 
& Frazzini; 

2. Kimployer’s copy of all Arizona State Em- 
ployment insurance returns covering employees 
working on the alleged subcontract work of Duque 
& Frazzini; 

3. Kmployer’s copy of all returns made under 
the Federal Insurance Contributions Act (Social 
Security) covering employees working on the al- 
leged subcontract work of Duque & Frazzini; 

4. Policy of Insurance covering public liability 
and property damage on the alleged subcontract 
work of Duque & Frazzini; 

5. Poley of Workmen’s Compensation Insnr- 
ance covering employees working on the alleged sub- 
contract work of Duque & Frazzini; 


Basich Brothers Construction Co. 85 


6. Subcontract bond bearing date the 20th day 
of February, 1945, in which Duque & Frazzini are 
named as Principal, Glens Falls Indemnity Com- 
pany is named as Surety and Basich Brothers Con- 
struction Co. is named as Obligee and letter bearing 
date March 7, 1945 addressed to Basich Bros. Con- 
struction Co., 600 So. Fremont Ave., Alhambra, 
Calif. from Glens Falls Indemnity Company, By 
Marwin F. Jonas, Attorney; 

7. Daily record of all material produced by 
Duque & Frazzini between February 19, 1945 and 
June 8, 1945 inclusive, on the alleged subcontract 
work of Duque & Frazzini; [874] 


8. Letter bearing date May 19, 1945 addressed 
to Basich Brothers Construction Co., Tucson, Ari- 
zona, by Duque and Frazzini, By A. Duque; 

9. Letter bearing date June 7, 1945 addressed 
to Basich Brothers Construction Company, ¢/o 
Stephen Monteleone, Attorney, 714 West Olympic 
Boulevard, Los Angeles 15, California, by J. H. Me- 
Call; 


10. Letter bearing date June 23, 1945 addressed 
to Basich Brothers Construction Company, ¢/o Mr. 
Stephen Monteleone, Attorney, 714 West Olympic 
Boulevard, Los Angeles 15, California, by J. H. 
McCall. 


and you are further notified that in case of your 
failure to produce any of said documents, defendant 


86 Glens Falls Indemnity Co. vs. 


Glens Falls Indemnity Company, a corporation will 
offer secondary evidence of its contents. 


Dated this 25th day of June, 1946. 


/s/ JOHN E. McCALL, 
Attorney for Defendant Glens Falls Indemnity 
Company, a corporataion. [375] 


Received copy of the within Notice to Produce 
this 27th day of June, 1946. 


/s/ STEPHEN MONTELEONE, 
Attorney for Plaintiff. 


[Fndorsed]: Filed June 28, 1946. 


[Title of District Court and Cause. ] 


REQUEST FOR ADMISSION UNDER 
RULE 36 


Defendant Glens Falls Indemnity Company re- 
quests plaintiff Basich Brothers Construction Com- 
pany to make the following admissions for the pur- 
pose of this action onlv and subject to all pertinent 
objections to admissibility which may be interposed 
at the trial, to-wit: 

That each of the following statements is true: 

1. Basich Brothers Construction Company, a 
corporation, plaintiff herein, is named as employer 
in all withholding returns and withholding receipts 
which were filed with the Internal Revenue Depart- 


Basich Brothers Construction Co. 87 


ment covering employees working on the alleged 
subcontract [877] work of Duque & Frazzini. 


2. Basich Brothers Construction Company, a 
corporation, plaintift herein, is named as employer 
in all Arizona State Employment Insurance returns 
covering employees working on the alleged subcon- 
tract work of Duque & Frazzini. 


3. Basich Brothers Construction Company, a 
corporation, plaintiff herein, is named as emplover 
in all Social Security returns made under the Fed- 
eral Insurance Contributions Act, covering em- 
ployees working on the alleged subcontract work of 
Duque & Frazzini. 


4. Basich Brother Construction Company, a 
corporation, plaintifi herein, is named as insured 
in all policies of insurance covering public lability 
and property damage on the alleged subcontract 
work of Duque & Frazzini. 


5. Basich Brothers Construction Company, a 
corporation, plaintiff herein, is named as employer 
in all Workmen’s Compensation Insurance policies 
covering employees working on the alleged subcon- 
tract work of Duque & Frazzini. 


6. All wages and salaries of all employees per- 
forming labor or services on the alleged subcontract 
between the plaintiff herein and Duque & Frazzini, 
dated February 7, 1945, were paid by the plaintiff 


88 Glens Falls Indemnity Co. vs. 


Basich Brother Construction Company, a corpora- 
tion. 


Dated July 8, 1946. 


/s/ JOHN E. McCALL, 
Attorney for Defendant Glens Falls Indemnity 
Company, a corporation. 


Received copy of the within request for admission 
under Rule 36 this 8th day of July, 1946. 


STEPHEN MONTELEONE; 
Attorney for Plaintiff. 


[Endorsed]: Filed July 8, 1946. [878] 


[Title of District Court and Cause. ] 


STIPULATION 


It Is Hereby Stipulated by and between the plain- 
tiff and the defendant Glens Falls Indenmity Com- 
pany, a corporation, represented by their respective 
attorneys of record, that said defendant Glens Falls 
Indemnity Company, a corporation, may file the 
amended answer now lodged with the Clerk of the 
above-entitled Court, a true copy of which is hereto 


Basich Brothers Construction Co. 89 


attached, and service of a copy of said amended 
answer is hereby accepted. 


Dated September 6th, 1946. 


/s/ STEPHEN MONTELEONE, 
Attorney for Plaintiff. 


/s/ JOHN E. MeCALL, 
Attorney for Defendant Glens Falls Indemnity 
Company, a corporation. 


It is so ordered: 9/9/46. 
/s/ PEIRSON M. HALL, 
Judge. 


[Endorsed]: Filed Sept. 9, 1946. 


[Title of District Court and Cause. ] 


FIRST AMENDED ANSWER OF DEFEND- 
ANT GLENS FALLS INDEMNITY COM- 
PANY, A CORPORATION 


Comes now Glens Falls Indemnity Company, a 
corporation, one of the defendants in the above- 
entitled action, and leave of court having been first 
had and obtained, files this its first amended answer 
to plaintiff’s complaint herein, and for itself alone 
and not for its co-defendants nor either of them, 
admits, denies and alleges: 


[. 
This defendant admits the allegations contained 
in Paragraphs I, II and IV of said complaint. 


90 Glens Falls Indemnity Co. vs. 


IBe 
This defendant alleges that it is without knowl- 
edge or information sufficient to form a belief as 
to the truth of the allegations contained in Para- 
graph ILL of said complaint. 


VE. 

Answering Paragraph V of said complaint, this 
defendant denies that a copy of the contract entered 
into between plaintiff and the United States of 
America referred to in said Paragraph V is too 
voluminous to attach to plaintiff’s complaint as an 
exhibit, and denies that this defendant knows the 
contents thereof. This defendant admits each and 
every allegation in said Paragraph V not herein in 
this paragraph denied. 

TN. 

Answering Paragraph VI of said complaint, this 
defendant admits that on or about the 7th day of 
February, 1945, plaintiff entered into an alleged 
subeontract with defendants Duque & Frazzini and 
that a copy of said alleged subcontract is attached 
to plaintiff’s complaint marked Exhibit ‘‘A’’, but 
this defendant denies that said alleged subcontract 
contained or contains any terms, provisions or con- 
ditions other than those expressly set forth in the 
language of the alleged subcontract itself, a copy 
of which is attached to said complaint marked Ex- 
hibit ‘‘A’’. This defendant alleges that it is with- 
out knowledge or information sufficient to form a 
belief as to the truth of any of the allegations of 
said Paragraph VI not herein in this paragraph 
admitted or denied. 


Basich Brothers Construction Co. G1 


Ve 

Answering Paragraph VII of said complaint, 
this defendant admits that on or about the 20th day 
of February, 1945, it executed and delivered to 
plaintiff, within the Southern District of California, 
Central Division, a subcontract bond in the penal 
sum of $101,745.55, wherein Duque & Frazzini were 
named as principal, and that on or about the 7th 
day of March, 1945, this [881] defendant addressed 
a letter to Basich Brothers Construction Company 
at Alhambra, California, which reads as follows: 


“GLENS FALLS INDEMNITY COMPANY 
of Glens Falls, New York 

Los Angeles 13, California 
Mareh 7th, 1945 


RE: Duque & Frazzini to Basich Bros. 
Construction Co. Contract bond 


Basich Bros Construction Co. 
600 So. Fremont Ave. 
Alhambra, Calif. 


Gentlemen: 


It is hereby understood and agreed that the 
10 days appearing in paragraph ‘First’ is 
changed to read ‘Twenty (20) days’. 


GLENS FALLS INDEMNITY 
COMPANY, 


[Seal] By MARWIN F. JONAS, 
MARWIN F. JONAS, 
Attorney.”’ 


92 Glens Falls Indemnity Co. vs. 


This defendant admits that a copy of said sub- 
contract bond is annexed to said complaint marked 
Exhibit ‘‘B’’, but this defendant denies that said 
bond then contained or now contains any terms, 
provisions, conditions or covenants other than those 
expressly set forth m the language of said subcon- 
tract bond itself. 

This defendant denies each and every allegation 
of said Paragraph VII not hereinbefore in this 
paragraph admitted. 

VI. 

Answering Paragraph VIII of said complaint, 
this defendant denies that said subcontract bond at 
anv time became or remained or is now in full or 
any force or effect, and denies that plaintiff at any 
time duly or otherwise performed or complied with 
or fulfilled all or any of the conditions or stipula- 
tions in [382] said bond contained on its part to be 
performed, and says that plaintiff failed, among 
other things, to comply with the conditions prece- 
dent to any right of recovery by the plaintiff on 
said subcontract bond, im that: 

Plaintiff failed to deliver to this defendant notice 
of default on the part of said subcontractor as re- 
quired by the terms of said subcontract bond; 

Plaintiff proceeded to and did continue m full 
control and took complete possession of all work 
remaining to be done under said alleged subcontract, 
and thereafter continued in possession and control 
of said work until the same was completed, con- 
trary to the following express condition precedent 
contained in said subcontract bond “that the Surety 


Basich Brothers Construction Co. 93 


shall have the right within thirty (80) days after 
receipt of such notice, to proceed or procure others 
to proceed with the performance of such contract” ; 

Plaintiff failed to faithfully or otherwise perform 
all of the terms, covenants or conditions of said al- 
leged subcontract on the part of plaintiff to be per- 
formed ; 

Plaintiff failed to retain the last payment payable 
by the terms of said alleged subcontract, without 
the consent of this defendant thereto in writing or 
otherwise ; 

Plaintiff failed to retain all or any reserves or 
deferred payments retainable by the plaintiff under 
the terms of said alleged subcontract, without the 
consent of this defendant thereto in writing or 
otherwise. 

VII. 

This defendant admits the allegations contained 

in Paragraph IX of said complaint. 


VITL. 

This defendant alleges that it is without knowl- 
edge or information sufficient to form a belief as 
to the truth of the allegations contained in Para- 
graph X of said complaint. [383] 


IDS 
Answering Paragraph XI of said complaint, this 
defendant admits that it has not paid any labor or 
equipment or material bills on account of labor per- 
formed or materials or equipment furnished in con- 
nection with any subcontract with plaintiff, and de- 
nies that any labor or materials or equipment were 


94 Glens Falls Indemnity Co. vs. 


furnished to or for this defendant, and denies that 
this defendant had or has any contract with plain- 
tiff for the payment of any bills or the performance 
of any work whatever. This defendant admits that 
some time subsequent to the 5th day of April, 1945, 
the exact date whereof this defendant does not 
know, it received a copy of letter dated April 5th, 
1945 addressed to Duque & Frazzini, Tonopah, Ne- 
vada, but denies that said letter contained any 
language other than that expressly set forth in the 
letter itself, a copy of which is hereunto attached, 
marked Exhibit ‘‘1’’ and made a part hereof, and 
denies that said letter constituted notice to this de- 
fendant as required by the terms of the subcontract 
bond. 
xX. 

Answering Paragraph XII of said complaint, 
this defendant denies that it fully or at all investi- 
gated any facts or conditions relative to any default 
by said subcontractor, either through its duly auth- 
orized agents or respresentatives or otherwise, or 
that it was thereby or otherwise fully or at all ad- 
vised as to any facts thereto appertaining. This 
defendant alleges that it is without knowledge or 
information sufficient to form a belief as to the 
truth of anv of the allegations of said Paragraph 
XII not herein in this paragraph admitted or de- 
nied. 

XIE. 

Answering Paragraph XITI of said complaint, 
this defendant admits that it received a letter from 
plaintiff, by and through plaintiff’s attorney 
Stephen Monteleone, dated April 27th, 1945, but this 


Bastch Brothers Construction Co. 95 


defendant denies that said letter contained any 
language [384] other than that expressly set forth 
in the letter itself, a copy of which is hereunto at- 
tached marked Exhibit ‘‘2’’, and made a part 
hereof. This defendant denies that said letter con- 
stituted notice to this defendant as required by the 
terms of the subcontract bond. This defendant 
alleges that it is without knowledge or information 
sufficient to form a belief as to the truth of any of 
the allegations in said Paragraph XIII not herein 
in this paragraph admitted or denied. 


NU, 

Answering Paragraph XIV of said complaint, 
this defendant denies that by reason of the failure 
of Duque & Fvazzini to perform faithfully the work 
contracted to be done under their said contract with 
plaintiff, or at their own expense to furnish all 
necessary material or perform all necessary labor 
incidental thereto, or for any other reason or at all, 
it became necessary for plaintiff to furmsh any 
labor or material or equipment for the purpose of 
completing the work contracted to be done by Duque 
& Frazzini or for anv other purpose, and this de- 
fendant denies that at any time or for any reason 
or at all, it became necessary for plaintiff to pay for 
any materials, or supplies or equipment used or 
employed by said Duque & Frazzini during the pe- 
riod from on or about February 19th, 1945 to on or 
about June 8th, 1945 or at any other time, for the 
purpose of completing the work contracted to be 
done by said Duque & Frazzini under said subecon- 
tract or for any other purpose. 


96 Glens Falls Indemnity Co. vs. 


2 JU0E 

Answering Paragraph XV of said complaint, this 
defendant alleges that it is without knowledge or 
information sufficient to form a belief as to the 
truth of the allegations in said paragraph contained, 
and on that ground denies that plaintiff paid for 
labor ov materials or supplies or equipment in the 
amounts set forth in said paragraph or any other 
sums or amounts, and on said ground [385] denies 
that plaintiff paid out items totaling $85,172.63 or 
any other sum, and on the same ground denies each 
and every other allegation in said Paragraph XV 
contained. 

TY. 

This defendant alleges that it is without know]- 
edge or information sufficient to form a belief as 
to the truth of the allegations contained in Para- 
graph XVI of said complaint. 


LG's 

Answering Paragraph XVII of said complaint, 
this defendant denies that it was at all times or at 
any time promptlv notified by registered mail or 
otherwise, of acts or omissions of Duque & Fraz- 
zini as alleged in said Paragraph XVII or other- 
wise. This defendant admits that at some time 
subsequent to June 11th, 1945, the exact date 
whereof is unknown to this defendant, it received 
a letter dated June 11th, 1945, from plaintiff, and 
admits that it took no action to perform any work 
alleged to have been abandoned by Duque & Fraz- 
zini. This defendant has no knowledge or informa- 
tion sufficient to form a belief as to the truth of the 


Basich Brothers Construction Co. 97 


other allegations in said Paragraph A VII, and on 
that ground denies all of said allegations not herein- 
before in this paragraph admitted or denied, and 
on the same ground denies that plaintiff expended 
the sum or sums mentioned in said Paragraph 
XVII or any other sum or amount whatever. 


XVI. 

This defendant alleges that it is without knowl- 
edge or information sufficient to form a belief as 
to the truth of the allegations contained in Para- 
eraph XVIII of said complaint, and on that ground 
denies each and every allegation therein, and on the 
same ground denies that there is due plaintiff $42,- 
047.30 or any other sum or amount. 


XVII. 

This defendant denies that there is now due or 
owing or [386] unpaid from this defendant to plain- 
tiff the sum cf $78,503.71 or any other sum or 
amount whatever, as alleged in Paragraph XIX 
of said complaint or otherwise. 


XVIII. 

Answering Paragraph XX of said complaint, this 
defendant denies that plaintiff has done or per- 
formed, fully or otherwise, each or every or any 
act on its part to be performed under the terms of 
the said subcontract bond, a copy of which is at- 
tached to plaintiff’s complaint as Exhibit ‘‘B’’, and 
says that plaintiff failed, among other things, to 
comply with the conditions precedent to any right 
of recovery by the plaintiff on said subcontract 
bond, in that: 


98 Glens Falls Indemnity Co. vs. 


Plaintiff failed to deliver to this defendant notice 
of default on the part of said subcontractor as re- 
quired by the terms of said subcontract bond; 

Plaintiff proceeded to and did continue in full 
control and took complete possession of all work 
remaining to be done under said alleged subcontract, 
and thereafter continued in possession and control 
of said work until the same was completed, contrary 
to the following express conditions precedent con- 
tained in said subcontract bond ‘‘that the Surety 
shall have the right, within thirty (80) days after 
receipt of such notice, to proceed or procure others 
to proceed with the performance of such contract”’; 

Plaintiff failed to faithfully or otherwise perform 
all of the terms, covenants or conditions of said 
alleged subcontract on the part of plaintiff to be 
performed ; 

Plaintiff failed to retain the last payment pay- 
able by the terms of said alleged subcontract, with- 
out the consent of this defendant thereto in writing 
or otherwise ; 

Plaintiff failed to retain all or any reserves or 
deferred payments retainable by the plaintiff under 
the terms of said alleged subcontract, without the 
consent of this defendant [887] thereto in writing 
or otherwise. 

XIX. 

Answering Paragraph XXI of said complaint, 
this defendant denies that by reason of any failure 
of this defendant to do any act or thing, whether 
as alleged in said complaint or otherwise, the plain- 
tiff has suffered any loss whatever, either in the 


Basich Brothers Construction Co. 99 


total sum of $78,503.71 or any other sum or amount. 
This defendant admits that plaintiff has demanded 
of it payment of said sum, but denies that any sum 
or amount or thing whatever is due or owing or 
unpaid to the plaintiff from this defendant. This 
defendant alleges that it is without knowledge or 
information sufficient to form a belief as to the 
truth of any of the allegations in said Paragraph 
XXI not herein in this paragraph admitted or 
denied. 


First Affirmative Defense 


For its first affirmative defense, this defendant 
alleges: 
if 
That the complaint herein fails to state a claim 
against this defendant upon which relief can be 
granted. 


Second Affirmative Defense 


For its second affirmative defense, this defendant 

alleges: 
ie 

That all obligations of this defendant under the 
terms of said subcontract bond on which recovery 
is sought by the plaintiff in this action, a copy ‘of 
which is attached to said complaint as Exhibit ‘‘B’’, 
are by the terms of said bond expressly conditioned 
that if the principal shall perform faithfully the 
work contracted to be performed under the terms 
of said alleged subcontract referred to in said bond, 


100 Giens Falls Indemnity Co. vs. 


then the obligations of said bond shall [888] be 
void, otherwise to remain in full force and effect, 
subject, however, among others, to the following 
provisions : 


‘‘Provided, however, as to said Obligee, and 
upon the Express Conditions, the performance 
of each of which shall be a condition precedent 
to any right of recovery hereon by said 
Obligee : 

First: That in the event of any default on 
the part of the Principal, written notice thereof 
shall be delivered to the Surety, by Registered 
mail at its office in the City of Los Angeles 
promptly, and in any event within ten (10) 
days after the owners, or his representative, or 
the architect, if any, shall learn of such default; 
that the Surety shall have the right, within 
thirty (30) days after receipt of such notice, 
to proceed or procure others to proceed with 
the performance of such contract; shall also 
be subrogated to all the rights of the Principal; 
and any and all moneys or property that may 
at the time of such default be due, or that there- 
after may become due to the Principal under 
said contract, shall be credited upon any claim 
which the Obligee may then or thereafter have 
against the Surety, and the surplus, if any, ap- 
plied as the Surety may direct. 


Second: That the Obligee shall faithfully 
perform all of the terms, covenants and condi- 


Basich Brothers Construction Co. 101 


tions of such contract on the part of the Obligee 
to be performed; and shall also retain the last 
payment pavable by the terms of said contract, 
and all reserves and deferred payments retain- 
able by the Obligee under the terms of said 
contract until the complete performance by 
the Principal of said contract, and until the 
expiration of the time within which notice of 
claims or claims of liens by persons performing 
work or furnishing materials under said con- 
tract ‘may he filed and until all [889] such 
claims shall have been paid, mless the Surety 
shall consent, in writing, to the payment of 
said Jast payment, reserves or deferred pay- 
ments. ”’ 


That by the language of said subcontract bond, 
the plaintiff in this action is designated as ‘“‘the 
Obligee”’ or ‘“‘the owner’? and this defendant as 
‘“‘the Surety.”’ 


That after the execution of said subcontract bond, 
and on or about the 7th day of March, 1945, at the 
special instance and request of the plaintiff, this 
defendant addressed a letter to the plaintiff in 
words and figures as follows: 


102 Glens Falls Indennity Co. vs. 


‘‘Glens Falls Indemnity Company 
of Glens Falls, New York 


Los Angeles 13, California 
March 7th, 1945 


RE: Duque & Frazzini to Basich Bros. 
Construction Co. Contract bond 


Basich Bros. Construction Co. 
600 So. Fremont Ave. 
Alhambra, Calif. 


Gentlemen: 


It is hereby understood and agreed that the 
10 days appearing in paragraph ‘First’ is 
changed to read ‘twenty (20) days.’ 


GLENS FALLS 
INDEMNITY COMPANY 


[Seal] By MARWIN F. JONAS, 
Attorney”’ 


II. 
That plaintiff failed to comply with the aforesaid 
conditions precedent, and in particular with the 
following condition, among others, to wit: 


‘‘That in the event of any default on the part 
of the Principal, written notice thereof shall 
be delivered to the Surety, by Registered mail 
at its office in the City of Los Angeles promptly, 
and in any event within ten (10) days after 
the owner, or his representative, or the archi- 
tect, if any, shall learn of such default; * * *.” 


Basich Brothers Construction Co. 103 


That after the execution of said subcontract bond, 
and on or about the 7th day of March, 1945, at the 
special instance and request of the plaintiff, this 
defendant addressed a letter to the plaintiff which 
reads, 11 part, as follows: 


‘It is hereby understood and agreed that the 
10 days appearing in paragraph ‘First’ is 
changed to read ‘twenty (20) days.’ ”’ 


IIT. 

That in and by the terms of plaintiff’s alleged 
subcontract with defendants Duque & Frazzini, it 
was provided that the said subcontractor should be 
required to produce sixteen hundred (1600) cubic 
yards of material per day; that said subcontractor 
should be required to start production of materials 
not later than the 19th day of February, 1945, and 
to furnish sixteen hundred (1600) cubic yards per 
day thereafter until completion, and that time 
should be of the essence in the performance of said 
alleged subcontract, all of which are more fully 
alleged in Paragraph IX of plaintiff’s complaint 
herein. 

He 

That this defendant is informed and believes and 
upon that ground alleges that said subcontractor 
defaulted in the performance of its alleged subcon- 
tract on and during every day from the 19th day 
of February, 1945, until on and after the 8th day 
of June, 1945. That said default or defaults on the 
part of the said subcontractor were known to or 
came to the knowledge of the plaintiff, designated 


104 Glens Falls Indemnity Co. vs. 


in said bond as Obligee or owner, or its representa- 
tive, during every day of said period from Feb- 
ruary 19th, 1945, until on [591] and after the 8th 
day of June, 1945. That this defendant did not 
at any time during the said period nor does it now 
have any knowledge of either the nature or extent 
of the aforesaid default or defaults, except that 
this defendant is informed and believes and upon 
that ground alleges that said subcontractor failed 
during each and every day of said period to pro- 
duce as much as sixteen hundred (1600) cubie yards 
of material, and that said subcontractor failed to 
start production of material on or before the 19th 
day of February, 1945. That the plaintiff had full 
knowledge of all the facts herein alleged at the 
time said default or defaults occurred. 


Ne 

That plaintiff did not nor did anyone else deliver 
to this defendant, and this defendant did not re- 
ceive notice of any default or defaults on the part 
of the principal as required by the terms of said 
subeontract bond. This defendant admits that some 
time subsequent to the 5th day of April, 1945, the 
exact date whereof this defendant does not know, 
it received a copy of letter dated April 5, 1945, ad- 
dressed to Duque & Frazzini, Tonopah, Nevada, a 
copy of which is hereto attached marked Ex- 
lover al, 

Third Affirmative Defense 


For its third affirmative defense, this defendant 
alleges: 


Basich Brothers Construction Co. 105 


ile 
This defendant incorporates by reference herein 
all the allegations contained in Paragraph I of its 
second affirmative defense hereinbefore set forth. 


II. 
That plaintiff failed to comply with the aforesaid 
conditions precedent, and in particular with the 
following conditions, among others, to wit: [3892] 


cx * * that the Surety shall have the right, 

within thirty (80) days after receipt of such 

notice, to proceed or procure others to proceed 

with the performance of such contract; * * *.”’ 
ITT. 

That this defendant is informed and believes and 
upon such information and behef alleges that on 
or prior to the 8th dav of June, 1945, the suh- 
contractor abandoned the work under the said 
alleged subcontract or was compelled by the plain- 
tiff to cease operations thereunder, and that plain- 
tiff proceeded to and did continue in full control 
and took complete possession of all work remaining 
to be done under said alleged subcontract, and there- 
after continued in possession and control of said 
work unti] the same was completed. 


Fourth Affirmative Defense 


For its fourth affirmative defense, this defendant 
alleges: 
if 
This defendant incorporates by reference herein 
all the allegations contained in Paragraph I of the 
second affirmative defense hereinbefore set forth. 


106 Glens Falls Indemnity Co. vs. 


JL. 
That plaintiff failed to comply with the aforesaid 
conditions precedent, and in particular, with the 
following condition, among others, to wit: 


“That the Obligee shall faithfully perform 
all of the terms, covenants and conditions of 
such contract on the part of the Obligee to be 
perommed: “457. 


1G. 

That this defendant is informed and believes and 
on that ground alleges that during the period from 
the llth day of [893] February, 1945, until on and 
after the 8th day of June, 1945, the plaintiff vio- 
lated the terms of said alleged subcontract, and 
particularly Article X VI thereof, in that said plain- 
tiffs paid to or for the account of said subcontractor, 
on account of the subcontract work, large sums of 
money, the exact amount of which this defendant 
does not know, in excess of ninety per cent of engi- 
neers estimate and ninety per cent of useable mate- 
rials in stockpile. 

IN: 

That this defendant is informed and believes and 
upon that ground alleges that during the period 
from the 11th day of February, 1945, until on and 
after the 8th day of June, 1945, the plaintiff vio- 
lated the terms of said alleged subcontract, and 
particularly Article XI thereof, in that said plain- 
tiff paid to or for the account of said subcontractor, 
on account of the subcontract work, large sums of 
money, the exact amount of which this defendant 


Bastch Brothers Construction Co. 107 


does not know, in excess of moneys due the sub- 
contractor under the alleged subcontract. 


We 

That this defendant is informed and believes and 
upon such information and belief alleges that dur- 
ing the period from the 11th day of February, 1945, 
until on and after the 8th day of June, 1945, the 
plaintiff furnished its own employees to do the sub- 
contract work, furnished equipment for the per- 
formance of the subcontract work, carried all of 
the men who performed the subcontract work on its. 
own payroll, named itself as employer of the men 
who performed the subcontract work in all Income 
Tax Withholding, Social Security and Unemploy- 
ment Insurance returns and Workmen’s Compen- 
sation Policies, carried in its own name as assured, 
Public Liability and Property Damage Insurance 
on the work being performed under said alleged 
subcontract, countermanded orders of the subcon- 
tractor to the men performing the subcontract [394] 
work, supervised and directed the production of 
material, and assumed and took over from the sub- 
contractor the control and supervision of the sub- 
contract work. 


Fifth Affirmative Defense 


For its fifth affirmative defense, this defendant 
alleges: 
I. 
This defendant incorporates by reference herein 
all the allegations contained in Paragraph I of the 
second affirmative defense hereinbefore set forth. 


108 Glens Falls Indemnity Co. vs. 


106, 
That plaintiff failed to comply with the afore- 
said conditions precedent, and in particular with 
the following condition, among others, to wit: 


‘That the obligee * * * shall also retain the 
last payment payable by the terms of said con- 
tract, and all reserves and deferred payments 
retainable by the Obligee under the terms of 
said contract until the complete performance 
by the Principal of said contract, * * * unless 
the Surety shall consent, in writing, to the pay- 
ment of said last payment, reserves or deferred 
payments. ”’ 

JOD, 

That this defendant is informed and believes and 
upon that ground alleges that plaintiff failed to 
retain said last payment payable by the terms of said 
subcontract, as required by said subcontract bond, 
or at all, but on the contrary paid to or for the 
account of said subcontractor, on account of the 
subcontract work, large sums of money, the exact 
amount of which this defendant does not know, in 
excess of moneys due the subcontractor under the 
alleged subcontract, which said payment or [395] 
payments included the last payment payable by the 
terms of said alleged subcontract. 


IV. 

That this defendant is informed and believes and 
upon such information and belief alleges that plain- 
tiff failed to retain all or any reserves or deferred 
payments retainable by plaintiff under the terms of 


Basich Brothers Construction Co. 3109 


said alleged subcontract, as required by said sub- 
contract bond, ov at all, but on the contrary paid 
to or for the account of said subcontractor, on ac- 
count of the subcontract work, large sums of money, 
the exact amount of which this defendant does not 
know, in excess of moneys due the subcontractor 
under the terms of said alleged subcontract, which 
said payment or payments included all reserves and 
deferred payments retainable by the plaintiff under 
the terms of said alleged subcontract. 


V. 

That the payment of said last payment and all 
of said reserves and deferred payments were made 
without the consent of this defendant thereto in 
writing or otherwise. 


Sixth Affirmative Defense 


For its sixth affirmative defense, this defendant 

alleges: 
i 

That this defendant is informed and believes and 
upon that ground alleges that at the time of the 
execution, delivery and acceptance of said subcon- 
tract bond, the subcontractor was in default under 
the terms of said alleged subcontract in that, among 
other things said subcontractor was indebted to the 
plaintiff for large sums of money, the exact amount 
of which this defendant does not know, paid by 
plaintiff to or for the account of said subcontractor, 
on account of the subcontract work, prior to the 
time when any moneys were due the subcontractor 


110 Glens Falls Indemnity Co. vs. 


under the terms of said alleged subcontract; and 
said subcontractor did not commence [396] pro- 
ducing material under the terms of said alleged 
subcontract on or before the 19th day of February, 
1945. That the plaintiff had reason to believe that 
such facts were unknown to this defendant; that 
the plaintiff had a reasonable opportunity to com- 
municate such facts to this defendant; that the 
plaintiff failed to communicate such facts to this 
defendant, but on the contrary concealed such facts 
from this defendant by suppressing plaintiff’s 
knowledge of the same and bv failing to mform 
this defendant that said subcontractor was then im 
default in the performance of said subcontract 
work, with the intent to induce this defendant to 
execute said subcontract bond. 


Je 

That this defendant was wholly deceived by 
plaintiff’s said concealment of said facts, and was 
thereby induced to make, execute and deliver the 
said subcontract bond, to this defendant’s damage. 
That this defendant would not have made, or exe- 
cuted or delivered said subcontract bond if this 
defendant had known or had any cause whatever 
to believe that said subcontractor was then in de- 
fault under the terms of said alleged subcontract. 


Seventh Affirmative Defense 


For its seventh affirmative defense, this defend- 
ant alleges: 


Basich Brothers Construction Co. al 


i 

That this defendant is informed and believes and 
upon that ground alleges that during the period 
from the 11th day of February, 1945, until on and 
after the 8th day of June, 1945, the said alleged 
subcontract was materially altered by the plaintiff, 
acting in agreement with the subcontractor, or with 
the consent and acquiescence of the subcontractor, 
and without the knowledge or consent of this de- 
fendant by the substitution of a new executed oral 
eoutract, which oral contract altered the said alleged 
subcontract [897] in the particulars, among others, 
as hereinafter in this affirmative defense alleged. 


10k 

Vhat Paragraph XVI of said alleged subcontract 
was altered to permit the payment by plaintiff and 
plaintiff did pay to or for the account of said sub- 
contractor, on account of the subcontract work, 
large sums of money, the exact amount of which 
this defendant does not know, in excess of ninety 
per cent of engineers estimate and ninety per cent 
of useable materials in stockpile. 


UIT. 

That Article XI of said alleged subcontract was 
altered to permit the payment by plaintiff and 
plaintiff did pay to or for the account of said sub- 
contractor, on account of the subcontract work, 
large sums of money, the exact amount of which 
this defendant does not know, in excess of moneys 
due the subcontractor under the alleged subcontract. 


ite? Glens Falls Indemnity Co. vs. 


IY. 

That said alleged subcontract was altered to per- 
mit plaintiff to and plaintiff did supervise and 
direct the production of materials and did take 
over and control and supervise the said subcontract 
work. 


Eighth Affirmative Defense 


For its eighth affirmative defense, this defendant 

alleges: 
Jt 

That this defendant is informed and believes and 
upon that ground alleges that during the period 
from the 11th day of February, 1945, until on and 
after the 8th day of June, 1945, the plaintiff pre- 
maturely paid to or for the account of the said 
subcontractor, on account of the subcontract work, 
large sums of money, the exact amount of which 
this defendant does not know, [398] as hereinafter 
in this affirmative defense alleged. 


100, 

That during the period from the 11th day of 
February, 1945, until the date when said subcon- 
tractor produced the first materials under said al- 
leged subcontract, which date is unknown to this 
defendant but which date this defendant is informed 
and believes and on that ground alleges was subse- 
quent to the 19th day of February, 1945, plaintiff 
paid to or for the account of the subcontractor, on 
account of the subcontract work, large sums of 
money, the exact amount of which this defendant 


Bastch Brothers Construction Co. ey 


does not know which payments were made prior to 
the date when any moneys were due to the subeon- 
tractor on account of the subcontract work. 


IWeh 
That during the period from the llth day of 
February, 1945, until on and after the 8th day of 
June, 1945, plaintiff paid to or for the account of 
said subcontractor, on account of the subcontract 
work, large sums of money, the exact amount of 
which this defendant does not know, in excess of 
moneys then due the subcontractor on account of 
the subcontract work. 
ie 
That during the period from the 11th day of 
February, 1945, until on and after the 8th day of 
June, 1945, plaintiff paid to or for the account of 
the subcontractor, on account of the subcontract 
work, large sums of money, the exact amount of 
which this defendant does not know, in excess of 
the total subcontract price. 


We 
That each and all of said payments were made 
without the knowledge, acquiescence or consent of 
this defendant. [399] 


Ninth Affirmative Defense 


For its ninth affirmative defense, this defendant 
alleges: 
I. 
That this defendant is informed and believes and 
upon that ground alleges that on or about the 8th 


114 Glens Falls Indemnity Co. vs. 


day of June, 1945, the subcontractor abandoned the 
work under said alleged subcontract, or was com- 
pelled by the plaintiff te cease operations there- 
under, and that plaintiff proceeded to and did con- 
tinue in full control and took complete possession 
of all work remaining to be done under said alleged 
subcontract, and thereafter continued in possession 
and control of said work until the same was com- 
pleted. 
It. 

‘That plaintiff by so taking possession and control 
of and proceeding with said work, elected to and 
did wholly waive its right to recover on said sub- 
contract bond. 

, 

That this defendant relied upon the aforesaid 
waiver and election of plaintiff, and so relying this 
defendant made no attempt whatever to exercise 
its right to proceed or procure others to proceed 
with the performance of said alleged subcontract 
as provided by the terms of said bond, and particu- 
larly the provisions of Paragraph ‘ First’’ thereof. 


Wherefore, this defendant prays that the plaintiff 
take nothing by its complaint; that this defendant 
be awarded judgment for its costs herein incurred 
and for such other and further relief as may appear 
equitable and proper. 


/s/ JOHN E. MeCALL, 
Attorney for Defendant Glens Falls Indemnity 
Company, a corporation. [400] 


Basich Brothers Construction Co. 115 


State of California, 
County of Los Angeles—ss. 


John E. McCall, being sworn, says: That he is 
an Attorney at Law admitted to practice before 
all courts of the State of California, and has his 
oifice in Los Angeles, Los Angeles County, State 
of California, and is the attorney for defendant 
Glens Falls Indemnity Company, a corporation in 
the above-entitled action; that said defendant is 
unable to make this verification because it has no 
officer within Los Angeles County, and for that 
reason affiant makes this verification on said de- 
fendant’s. behalf; that he has read the foregoing 
First Amended Answer of Defendant Glens Falls 
Indemnity Company, a Corporation, and knows 
the contents thereof, and that the same is true of 
his own knowledge, except as to those matters which 
are therein stated upon information or belief, and 
as to those matters that he believes it to be true. 


/s/ JOHN E. McCALL. 
Subscribed and sworn to before me this 28th day 
of August, 1946. 


[Seal] /s/ FRANK M. BEVERLY, 
Notary Public in and for the County of Los Ange- 
les, State of California. [401] 


116 Glens Falls Indemnity Co. vs. 
PMB Sexe 
Basich Brothers Construction Co. 


Registered Mail 
April 5, 1945 
Duque and Frazzini, 
Reo. Box 73. 
Tonopah, Nevada. 


Gentlemen: 


Reference is made to our Contract Agreement, 
dated Februarv 7, 1945, m which vou agreed to 
commence crushing material with one plant on 
February 19, 1945. It was further agreed that vou 
were to move in two plants, each capable of produe- 
ing 800 cubic yards per day of suitable material. 
Your attention is directed to the fact that the plant 
did not commence work on February 19th; further- 
nore, to date you have not averaged 800 cubie yards 
of material per plant per day. 


Since we reserve the right to compel vou to move 
in additional equipment to insure proper comple- 
tion of your contract, we hereby demand that you 
move in additional and suitable equipment in order 
to produce the amount agreed upon in our contract. 


Our entire concrete paving operation is depend- 
ent on your production and you are reminded that 
vour Company is now using our tools and equip- 


Basich Brothers Construction Co. 117 


ment, since you do not have suitable equipment of 
your own on the job. 


Very truly yours, 


BASICH BROTHERS CON- 
SIFRUCTONICO: 


By /s/ N. L. BASICH. 


ec: Duque & Frazzini. Tueson, Ariz. 
ce: Glens Falls Indemnity Co., 

Los Angeles, California. 
elie /de 


EXHIBIT No. 2 


Law Offices 
Stephen Monteleone 


Petroleum Building 
713 West Olympic Boulevard 
Los Angeles 15 


April 27, 1945 


To Duque & Frazzini 
P. O. Box 73 
Tonopah, Nevada, 
and 
Glens Falls Indemnity Company 
Of Glens Falls, New York, 
801 Fidelity Building, 
548 South Spring Street 
Los Angeles 13, California 


You and each of you are hereby notified that: 
Whereas, on February 7, 1945, Basich Brothers 


18 Glens Falls Indemnity Co. vs. 


Construction Company, as first party, entered into 
a written contract with said Duque & Frazzini as 
second parties by the terms of which said contract 
said second parties, as subcontractors, agreed to 
perform certain of the requirements therein spe- 
cifically stated in connection with the contract be- 
tween first party as the Prime Contractor and the 
United States of America for the construction of 
Taxiways, warm-up and parking aprons, Job No. 
Davis-Monthan ESA 210-6, 210-8, and 210-9, Davis- 
Monthan Field, Tuscon, Arizona, Contract No. W- 
04-353-Eng.-1302 ; 

Whereas, in said contract between said first party 
and said second parties of date February 7, 1945, 
it is provided, among other things, that if said 
second parties, as such subcontractors, shall fail to 
prosecute said work continuously with sufficient 
workmen and equipment to insure its [403] comple- 
tion, first party, within five days will reserve the 
right to compel said subcontractors to move in an- 
other plant; 

Whereas, said second parties, as such subcontrac- 
tors, agreed to erect two plants, each to produce 
800 cubic vards of suitable material a day to be 
used in connection with said Government Contract; 

Whereas, said second parties agreed, in said con- 
tract of date February 7, 1945, to commence their 
work not later than February 19, 1945, and shall 
complete the same on or before June 3, 1945; 

Whereas, it is therein further provided that time 
is of the essence of said contract; 

Whereas, said second parties have failed to com- 


Basich Brothers Construction Co. 119 


ply with the obligations imposed on them in said 
contract of date, February 7, 1945, in that, among 
othe: things, they have failed to prosecute said 
work continuously with sufficient workinen and 
equipment as therein required; and further, they 
have failed to produce 800 cubic yards of suitable 
material a day from each of said two plants but in- 
stead have produced less than fifty per cent thereof ; 

Whereas, on April 5, 1945, said Basich Brothers 
Construction Company notified said Duque & Fraz- 
zini and its surety, said Glens Falls Indemnity 
Company, of the aforesaid failure to comply with 
said contract of date February 7, 1945, and de- 
manded that additional and suitable equipment be 
moved on the job to produce the amount of material 
as in said agreement provided, all of which both 
said second parties and their said surety company 
failed to do; 

Now, therefore, you, the said Duque & Frazzini, 
as principals, and said Glens Falls Indemnity Com- 
pany as the surety of said principals, are, and each 
of you are, hereby notified that said Basich Brothers 
Construction Company will hold you and each of 
you responsible for all direct and consequential [404] 
damages sustained by them by reason by said 
failure to comply with said contract and any future 
damages, both direct and consequential, which may 
result by your continued failure to comply with thie 
above requirements of said contract; 

You, and each of you are hereby notified that said 
Basich Brothers Construction Company will exer- 
cise all reasonable efforts to minimize said damages 


120 Glens Falls Indemnity Co. vs. 


and will endeavor to, and if possible, will install 
additional and independent means to produce the 
required material without in any manner waiving 
its claims or any rights against you and each of you 
or in any manner releasing you of any of vour obli- 
gations, past, present and future, under said con- 
tract of date February 7, 1945. 


Dated: April 27, 1945. 


BASICH BROTHERS CON- 
STRUCTION COMPS 
By STEPHEN MONTELEONKE, 
Its Attorney. 
SM/egr 


[Endorsed]: Filed Sept. 9, 1946. [405] 


[Title of District Court and Cause. ] 


AMENDMENTS TO BILL OF PARTICULARS 


To the Honorable, the District Court of the United 
States, Southern District of California, Central 
Division: 


Plaintiff, Basich Brothers Construction Company, 
a corporation, herewith presents amendments to its 
Bill of Particulars on file herein as applied to 
Schedule Vi (Insurance) of said Bill of Particulars 
by specifying each classification of insurance 
separately and the amount of premium paid thereon 
in connection with the subcontract of Duque & 
Frazzini, a co-partnership, referred to in Plain- 
tiff’s complaint as follows: [406] 


Basich Brothers Construction Co. I peal 


Insurance Breakdown 


Date Comp. P.L.& P.D. JN ADIGLER ACE Fea. Total 
2/17/45 26.39 10.29 15.26 7.35 noo 
2/24/45 80.66 27.03 46.63 22.45 176.77 
3/ 3/45 82.81 29.40 47.88 23.05 183.14 
3/10/45 62.54 25.36 36.16 17.41 141.47 
3/17/45 65.56 99.39 37.90 18.25 151.10 
3/24/45 91.38 35.65 52.83 25.44 205.30 
3/31/45 130.02 40.37 67.88 32.68 270.95 
4+/ 7/45 175.04 47.67 84.59 40.73 348.03 
4/14/45 209.87 59.90 99.86 48.08 413.71 
4/21/45" 176.21 44.23 84.60 40.73 345.77 
4/28/45 170.92 41.12 eon 39.10 332.35 
D/ 5/45 347.54 tree 121.57 58.54 545.44 
5/12/45 349.49 18.27 122.70 59.09 549.55 
5/19/45 280.99 14.71 96.65 46.54 438.89 
5/26/45 OL 12.61 95,29 45.88 415.55 
6/ 2/45 266.06 13.13 96.24 46.35 421.78 
6/ 9/45 267.38 13.34 94.97 45.71 421.40 
6/16/45 207.88 20.81 72.42 34.87 330.98 
6/23/45 ZO 22 22.44 73.56 35.42 341.64 
6/30/45 197-96 19.52 68.60 33.03 pled e stl 
T/ 7/45 171.05 o9) Bb £1 26.20 261.65 
7/14/45 120.95 4.94 38.15 18.37 182.41 
7/21/45 122.35 pall 38.59 18.58 184.63 
7/28/45 108.01 9.68 36.66 17.65 172.00 
8/ 4/45 102.31 15,59 38.93 18.75 175.58 
8/11/45 82.09 4.14 25.89 12.47 124.59 
8/18/45 +.79 2.2 2.17 1.33 11.16 
8/25/45 86.84 6.36 28.70 13.82 135.72 
9/ 1/45 70.98 5.95 93.92 11.51 112.36 
9/ 8/45 51.81 5.00 18.01 8.67 83.49 
9/15/45 16.08 1.06 5.07 2.44 24.65 
9/22/45 37.14 1.97 2 5.64 56.47 


4,635.09 611.09 1,819.62 876.13 7,941.93 
1,258.51" 1,258.51* 


Totals 5,893.60 611.09 1,819.62 876.13 9,200.44 


*Differential in 5506 and 1710 Rate in comp. insurance. 


122 Glens Falls Indemnity Co. vs. 


Explanation : 
The above constitutes Insurance Breakdown on the Duque 
and Frazzini Subcontract. 
Comp. refer to Compensation Insurance. 
P.L.& P.D. refers to Publie Liability and Property Damage. 
A.U.R.C. refers to Arizona Unemployment Reserve Commis- 
sion. 


F.0.A. refers to Federal Old Age and Excise Tax. 


State of California, 
County of Los Angeles—ss. 


Homer Thompson, being first duly sworn, deposes 
and says: That he is an auditor employed by Basich 
Brothers Construction Company and was in charge 
of the auditing of the accounts for said plaintiff in 
connection with the construction of the Government 
Project at Tucson, Arizona, referred to in Plain- 
tiff’s Complaint on file herein; that the herein 
amendment to Schedule VI of Plaintiff’s Bill of 
Particulars on file herein contains on itemized state- 
ment of insurance paid by plaintiff for its subcon- 
tractors, Duque & Frazzini, the same being segre- 
gated into the different classification of insurance 
as in said amendment specified and the amounts 
paid on account thereof and the same is true of his 
own knowledge. 

/s/ HOMER THOMPSON. 
Subseribed and sworn to before me this 14th day 
of November, 1946. 

[Seal] GEORGE J. POPOVICH, 
Notary Public in and for said County of Los Ange- 

les, State of Californiatl 


My commission expires Aug. 18, 1947. [409] 


Basich Brothers Construction Co. 123 
[Title of District Court and Cause.] 


Received copy of the within Amendment to Bull 
of Particulars this 15th day of November, 1946. 


J. KE. McCALL, 
By JOSEPH J. BURRIS, 
Attorney for Deft. Glens 
Falls I. Co. 


[Endorsed]: Filed Nov. 15, 1946. [410] 


[Title of District Court and Cause.] 


SPE BATION 


It Is Hereby Stipulated by and between the 
plaintiff and the defendant Glens Falls Indemnity 
Company, a corporation, represented by their re- 
spective attorneys of record: 

1. That Basich Brothers Construction Company, 
a corporation, plaintiff herein, is named as employer 
in all withholding returns and withholding receipts 
which were filed with the Internal Revenue De- 
partinent covering emplovees working on the alleged 
subcontract work of Duque & Frazzin; 


2. That Basich Brothers Construction Com- 
pany, a corporation, [411] plaintiff herein, is named 
as employer in all Arizona State Employment In- 
surance returns covering employees working on the 
alleged subcontract work of Duque & Frazzini; 


3. That Basich Brothers Construction Company, 
a corporation, plaintiff herein, is named as em- 
ployer in all Social Security returns made under 


124 Glens Falis Indemnity Co. vs. 


the Federal Insurance Contributions Act, covering 
employees working on the alleged subcontract work 
of Duque & Frazzini; 


4. That Basich Brothers Construction Company, 
a corporation, plaintiff herein, is named as insured 
in all policies of insurance covering public liability 
and property damage on the alleged subcontract 
work of Duque & Frazzini; 


5. That Basich Brothers Construction Company, 
a corporation, plaintiff herein, is named as emplover 
in all Workmen’s Compension Insurance policies 
covering employees working on the alleged sub- 
tract work of Duque & Frazzini; 


6. That all wages and salaries of all employees 
performing labor or services on the alleged sub- 
contract between the plaintiff herein and Duque & 
Frazzini, dated February 7, 1945, were paid by the 
plaintiff Basich Brothers Construction Company, 
a corporation. 


Dated July 1, 1946. 


Attorney for Plaintiff. 


JOHN KE. MeCALL, 
Attorney for Defendant Glens 
Falls Indemnity Company, 

a Corporation. 


[Endorsed]: Filed Oct. 14, 1946. [412] 


Basich Brothers Construction Co. 125 
[Letterhead John E. McCall] 


October 8, 1946 
Mr. Stephen Monteleone | 
Attorney at Law 


1050 Petroleum Building 
714 West Olympic Boulevard 
Los Angeles, California 


Dear Mr. Monteleone: 


Re: Basich Brothers Construction 
Company vs. Glens Falls Indemnity 
Company 
Our File No. 2025A 


You suggested that I point out the items in your 
Bill of Particulars to which we object. JI am listing 
a few specific entries from the various schedules, 
but if you will refer to the records which your client 
exhibited to My. Vernon you will see that similar 
items are too numerous to set out in a letter. 


(1) Time cards, weekly payroll sheets, and 
Basich Brothers Construction Company weekly 
payrolls do not indicate that the men working on 
the alleged subcontract job are employees of Duque 
& Frazzini: (Schedule I, I, Il, IV and V.) 


(2) These same records do not indicate that the 
men who were mentioned in the Bill of Particulars 
performed work on the alleged subcontract job: 
(Schedules I, If, ILI, IV and V). 


(3) Pay checks of men claimed to have been 
working on the alleged subcontract job do not show 


126 Glens Falls Indemnity Co. vs. 


that the employees mentioned in the Bill of Par- 
ticulars were employees of Duque & Frazzini: 
(Schedules I, IT, ITT, 1V and V). [413] 


(4) Numerous improper charges have been made 
in the Bill of Particulars, such as: 

(A) Schedule X lists one R. U. Carryall 
which is charged as fully operated (including 
operator). Schedule I charges the wages of 
L. HE. McDaniel and Rex McCoy, the operators 
of the equipment, for the same period. 

(B) Schedule X lists Dozer 428 as a 1214 
hour charge. The blue equipment card for 
Dozer lists 1014 hours. 

(C) Many time cards list impossible work- 
ing hours. For example, Jack L. Brown, April 
17, 1945, is credited with 2514 working hours, 
8 hours straight time and 1714 hours over- 
time is a part of Schedule I. 

(D) Clarence Hampton is credited with 21 
hours on March 2, 1945, with only 30 minutes 
deducted for eating time: (Schedule I). 

(HK) Schedule XXIV charges three months 
for bins but shows they were used 7 days less 
than three months. 

(F) Schedule XXI charges Duque & Fraz- 
zint with 179.5 truck hours on June 30, 1945. 
Records examined show only 99 truck hours on 
this date. 

(G) Many of the employees listed in Sched- 
wle I of the Bill of Particulars received rates 
of pay which were higher than the work 


Bastch Brothers Construction Co. 127 


classifications [414] which they performed: 
S. A. Moreno, a laborer, received the scale of 
an air tool operator; Victor Oasquez, a laborer, 
received the scale of a dumpman. 

(H) Schedule XVII charges Duque & 
Frazzini a royalty on production of 2,223 tons 
of sand for which they receive no payment 
under the production credits. 


if I am in error regarding any of the points men- 
tioned, please advise me. 


Yours very truly, 


J. EH. MeCALl. 
PEMceC :me 


[Endorsed]: Filed Oct. 14, 1946. [415] 


Basich Brothers Construction Co. 
Daily Home Office Report 


(4) A. This charge for wages of McDaniel & 
McCoy is incorrect. Credit $39.75. 

B. Charge should be 1014 instead of 12%. 
Credit 20.40. 

C. These hours on Jack lL. Brown were sub- 
mitted to us on D & F Payroll of which we have 
a copy oft the original. We never questioned hours 
worked on any of Duque & Frazzini men whose 
time was turned in by A. Duque on their own pay- 
roll. 

D. According to our records Clarence Hampton 
worked only 11 hrs. on Mareh 2, 1945. This is all 
we claim. 


128 Glens Falls Indemnity Co. vs. 


EK. Credit $15.00 for overcharge of 7 days rental 
of 2 bins. 

F. 17914 hrs. is in error. 99 hrs. are correct. 
Credit 332.47. 

G. Due to the labor shortage, it was necessary 
for us to make certain concessions in order to keep 
the men. 

H. JI beheve sand was included with Mineral 
Ager. 


[| Mndorsed]: Filed Oct. 14, 1946. [416] 


[Title of District Court and Cause. ] 


AMENDMENTS TO PLAINTIFEF’S 
COMPLAINT 


Comes now the plaintiff herein and, leave of 
Court being first had and obtained, files these 
amendments to its complaint on file herein, desig- 
nated as Paragraphs XXII, XXIII, XXIV, XXY, 
XXVI and XXVII respectively, and complains 
and alleges: 

DOL, 

That following the execution of the alleged sub- 
contract between plaintiff and Duque & Frazzini a 
copy of which is attached to plaintiff’s complaint 
and marked Exhibit ‘‘A,’’ said Duque & Frazzini 
advised plaintiff that their available cash was tied 
up in prior work they had completed, and were un- 
able to meet the payroll and supplies necessary in 
installing and operating their plant for the per- 


Basich Brothers Construction Co. 129 


formance of the requirements on their part under 
said contract and requested plaintiff to make said 
payments as in said contract provided; that by 
reason of the above situation and in compliance with 
the provisions of said Exhibit ‘‘A,’’ plaintiff made 
payments of labor, supply and material claims in- 
eurred by said Duque & Frazzini in the performance 
of said Exhibit ‘‘A’’ as therein provided; that at 
no time mentioned in plaintiff’s complaint or at all 
did plaintiff make any payment direct to said 
Duque & Frazzini in the performance by them of 
the requirements of said Exhibit ‘‘A,’’ or made any 
of said payments in any other manner except for 
and on account of said labor, supply and material 
claims, as aforesaid; that during all of said times, 
while plaintiff was making said payments, as afore- 
said, defendant, Glens Falis Indemnity Company, 
was fully advised thereof; that it had, in addition 
thereto, investigated through its duly authorized 
representatives, the records of said Duque & Fraz- 
bini and of said payments and amounts earned by 
said Duque & Frazzini up to the date of said inves- 
tigation and the manner under which all of said 
payments, including payments of premium and 
other charges on insurance required of said Duque 
& Frazzini under said Exhibit ‘‘A’’ were being 
made by plaintiff and thereupon charged against 
said Duque & Frazzini. 


130 Glens Falls Indemnity Co. vs. 


XXITI. 

That on or about May 24, 1945, plaintiff notified 
said defendant in writing that said Duque & Fraz- 
zini were not paying the said labor claims and that 
it, said plaintiff, had previous thereto, made said 
labor payments, material payments and supply pay- 
ments incurred by said Duque & Frazzini in the 
prosecution of said Exhibit ‘‘A’’ but that the 
amount of money earned by them thereunder was 
not sufficient to meet the past advancements made 
by it and said defendant and said Duque & Fraz- 
zini were therein notified to make payment of all 
present and future labor claims of said Duque & 
Frazzmi in the performance of said Exhibit ‘‘A”’. 
That said [418] defendant, in reply to said demand 
of plaintiff, notified plaintiff in writing through its 
duly authorized agent, on or about June 7, 1945, 
that plaintiff was required to make said payments 
pursuant to the provisions of said Exhibit ‘‘A’’. 


XXIV. 

That at no time referred in said complaint, did 
said defendant, after being fully advised, as afore- 
said, notify plaintiff that it, plaintiff had no right 
to make said payments or that the making of any 
such payments in excess of the amount earned by 
said Duque & Frazzini were in violation of any of 
the provisions of said Exhibit ‘‘A’’ or the provi- 
sions and conditions of the bond executed by said 
defendant referred to in said complaint, nor did 
it, at any of said time, or at all, advise plaintiff 
that it would disavow its liability under said bond. 


Basich Brothers Construction Co. ed 


OXY. 

That on or about April 5, 1945, said defendant 
was notified by plaintiff that said Duque & Frazzini 
were not meeting the quantity of material required 
by them under said Exhibit ‘‘A’’ and that addi- 
tional and suitable equipment be installed as re- 
quired under said Exhibit ‘‘A’’; that thereafter 
and on or about April 27, 1945, said defendant was 
again notified that said Duque & Frazzini had failed 
to prosecute the work as required under said Ex- 
hibit ‘‘A”’ or provide sufficient men and equipment 
as therein required and if said Duque & Frazzini 
and said defendant failed to comply with said de- 
mands,. plaintiff would adopt independent means to 
meet said requirements; that although said defend- 
ant was so notified and thereafter further notified 
of the aforesaid situation, it failed to make any 
provisions to remedy said situation nor did it at 
any time mentioned in plaintiff’s complaint or at 
all advise plaintiff that it desired, under its said 
bond, to provide the means of fulfilling the require- 
ments of said Exhibit ‘‘A’’ on the part of said 
Duque & Frazzini. [419] 

XXXVI. 

That, by reason of the conduct and acts of said 
defendants, as aforesaid, it waived any rights which 
it may have had for any alleged failure on the part 
of plaintiff to comply with any of the provisions of 
said bond or for any alleged changes in the terms 
of said Exhibit ‘‘A’’. 

Reval: 

That by reason of the conduct and acts of said 

defendant, as aforesaid, it is estopped from assert- 


ae, Glens Falls Indemmty Co. vs. 


ing any rights which it may have had for any 
alleged failure on the part of plaintiff to comply 
with any of the provisions of said bond or for any 
alleged changes in the terms of said Exhibit ‘‘A’’. 
Wherefore, plaintiff prays judgment as in its 
said complaint specified. 

STEPHEN MONTELEONE and 

TRACY J. PRIEST, 

By /s/ STEPHEN MONTELEONEH, 

Attorneys for Plaintiff. [420] 


State of California, 
County of Los Angeles—ss. 


N. L. Basich, being first duly sworn, deposes and 
says: That he is the President of plaintiff, Basich 
Brothers Construction Company, a corporation; 
that he has read the foregoing Amendments to 
Plaintiff’s Complaint and knows the contents 
thereof and that the same is true of his own knowl- 
edge, except as to matters stated on information 
and belief and, as to those matters he believes the 
same to be true. 

/s/ N. L. BASICH. 

Subseribed and sworn to before me this 27th day 

of December, 1946. 


/s/ KAY TROMBLEY, 
Notary Public in and for said County of Los Ange- 
les, State of California. 


My commission expires Feb. 138, 1950. 
[Affidavit of service by mail attached. ] 
[Endorsed]: Filed Jan. 5, 1947. 


Basich Brothers Construction Co. 133 
[Title of District Court and Cause. ] 


ANSWER OF DEFENDANT GLENS FALLS 
INDEMNITY COMPANY, A CORPORA- 
TION, TO PLAINTIFE’S COMPLAINT AS 
AMENDED. 


Comes now Glens Falls Indemnity Company, a 
corporation, one of the defendants in the above- 
entitled action, and answering plaintiff’s complaint 
as amended, on file herein, for itself and no other 
defendant, admits, denies and alleges as follows: 


I. 
This defendant reiterates and adopts all of the 
admissions, denials and allegations contained in its 
first amended answer herein. [423] 


10 

Answering the allegations in Paragraph XXil 
of the complaint as amended, this defendant ad- 
mits that plaintiff made certain payments on ac- 
eount of labor and supplies and materials used in 
the performance of the alleged subcontract work, 
but denies that said payments or any of them were 
made in complhance with the provisions of said 
Exhibit ‘‘A’’, and further denies that during all 
or any of said times this defendant was fully or 
at all advised thereof, and denies that this defend- 
ant learned through investigation or otherwise of 
said alleged payments, or of the amounts earned 
by Duque & Frazzini up to the date of said alleged 
investigation or at all, or the manner under which 
said alleged payments or any of them were made, 


134 Glens Falls Indemnity Co. vs. 


or in what manner, if any, said payments were 
charged against Duque & Frazzini. This defend- 
ant alleges that it is without knowledge or infor- 
mation sufficient to form a belief as to the truth 
of any of the allegations of said Paragraph X XII 
not herein in this paragraph admitted or denied. 


HHO 

Answering Paragraph XXIII of the complaint 
as amended, this defendant admits that some time 
subsequent to the 24th day of May, 1945, the exact 
date whereof this defendant does not know, it re- 
ceived a letter dated May 24th, 1945, addressed to 
Duque & Frazzini and Glens Falls Indemnity Com- 
pany of Glens Falls, New York, but denies that 
said letter contained any language other than that 
expressly set forth in the letter itself, a copy of 
which is attached hereto, marked Exhibit ‘'3’’ and 
by this reference made a part hereof. This defend- 
ant admits that on or about the 7th day of June, 
1945, through its attorney John E. McCall, it ad- 
dressed a letter to plaintiff herein, in care of 
Stephen Monteleone, plaintiff’s attorney, but this 
defendant denies that said letter notified plaintiff 
that it, plaintiff herein, was required to make said 
or any payments pursuant to the provisions of said 
Exhibit ‘*‘A’’, and denies that said letter contained 
any language other than that expressly set forth 
in the [424] letter itself, a copy of which is attached 
hereto, marked Exhibit ‘‘4’’ and by this reference 
made a part hereof. 


Basich Brothers Construction Co. 135 


IV. 

Answering Paragraph XXIV of the complaint 
as amended, this defendant denies that it was ever 
fully or at all advised as alleged by plaintiff in 
Paragraph XXIII of said complaint as amended, 
and denies that this defendant did not at any time, 
as alleged in said Paragraph XXIV, notify plain- 
tiff that plaintiff had no right to make said or any 
payments, but alleges that on or about the 7th day 
of June, 1945, this defendant notified plaintiff, in 
a letter addressed to plaintiff in care of its attorney 
Stephen Monteleone, a copy of which said letter is 
hereunto attached marked Exhibit ‘‘4,”’ that plaintiff 
had no right to charge anything to this defendant 
as Surety, inasmuch as the Surety had no Hability 
whatever except such lability as might exist under 
the express terms of its bond. This defendant fur- 
ther alleges that on or about the 23rd day of June, 
1945, in a letter addressed to plaintiff herein in care 
of its said attorney Stephen Monteleone, this de- 
fendant notified plaintiff that this defendant would 
not recognize any claim which was not expressly 
covered by the terms of its contract bond. That a 
copy of said letter of June 23rd, 1945, is attached 
hereto marked Exhibit ‘‘5’’ and by this reference 
made a part hereof. 

WE 

Answering Paragraph X XV of the complaint as 
amended, this defendant admits that some time sub- 
sequent to the 5th day of April, 1945, the exact date 
whereof this defendant does not know, it received 
a copy of letter dated April 5, 1945, addressed to 


136 Glens Falls Indemmty Co. vs. 


Duque & Frazzini, Tonopah, Nevada, a copy of 
which is attached to this defendant’s first amended 
answer herein as Exhibit ‘‘1’’, and admits that some 
time subsequent to the 27th day of April, 1945, the 
exact date whereof this defendant does not know, 
it received a letter from plaintiff, by and through 
plaintiff’s attorney Stephen Monteleone, [425] 
dated April 27th, 1945, a copy of which is attached 
to this defendant's first amended answer herein as 
Exhibit ‘‘2’’, but this defendant denies that said 
letters or either of them contained any language 
other than that expressly set forth in the said letters 
themselves. 
VL. 

Answering Paragraph XXVI of the complaint 
as amended, this defendant denies that it waived 
any right or rights which it had or now has under 
the terms and provisions of said subcontract bond 
or said subcontract as alleged in said Paragraph 
XX VI or at all. 

Sie 

Answering Paragraph XAVII of the complaint 
as amended, this defendant denies that it is estopped 
from asserting any right or rights which it had or 
now has by reason of the failure on the part of 
the plaintiff to comply with any of the provisions 
of said subcontract bond, or because of any altera- 
tions or changes in the terms of said subcontract 
referred to by plaintiff as Exlbit ‘‘A’’, or for any 
other reason or at all. 

Wherefore, this defendant prays that the plain- 
tiff take nothing by its complaint as amended; that 
this defendant be awarded judgment for its costs 


Basich Brothers Construction Co. Ti 


herein incurred and for such other and further re- 
lief as may appear equitable and proper. 
/s/ JOHN EH. MceCALL, 
Attorney for Defendant Glens Falls Indemnity 
Company, a corporation. [426] 


State of California, 
County of Los Angeles—ss. 


John EH. McCall, being sworn, says: That he is 
an Attorney at Law admitted to practice before all 
courts of the State of California, and has his office 
in Los Angeles, Los Angeles County, State of Cali- 
fornia, and is the attorney for defendant Glens 
Falls Indemnity Company, a corporation in the 
above-entitled action; that said defendant is unable 
to make this vertification because it has no officer 
within Los Angeles County, and for that reason 
affiant makes this verification on said defendant’s 
behalf; that he has read the foregoing Answer of 
Defendant Glens Falls Indemnity Company, a Cor- 
poration, to Plaintiff’s Complaint as Amended, and 
knows the contents thereof, and that the same is 
true of his own knowledge, except as to those mat- 
ters which are therein stated upon information or 
belief, and as to those matters that he believes it 
to be true. 

/s/ JOHN E. MceCALL. 
Subseribed and sworn to before me this 17th day 
of January, 1947. 

[Seal] /s/ FRANK M. BENEDICT, 

Notary Public in and for the County of Los Ange- 
les, State of California. [427] 


138 Glens Falls Indemnity Co. vs. 


EXHIBIT No. 3 
[ Letterhead Stephen Monteleone] 


May 24, 1945 

To Duque & Frazzini 
(eS OR exe 73) 
Tonopah, Nevada 

and 
Glens Falls Indemnity Company of 

Glens Falls, New York, 

801 Fidelity Building 

548 South Spring Street 

Los Angeles 138, California 


Gentlemen: 


You and each of you are hereby notified: 

That on February 7, 1945, Basich Brothers Con- 
struction Company, prime contractor as first party, 
entered into a written contract with Duque & Fraz- 
zini as sub-contractor, second parties, in connection 
with the construction of taxiways, warm-up and 
parking aprons, Job. No. Davis-Monthan ESA 
210-6, 210-8 and 210-9, Davis-Monthan Field, 
Tucson, Arizona, Contract No. W-04-353-Eng. 1302; 

Whereas, pursuant to said contract, Glens Falls 
Indemnity Company of Glens Falls, New York, 
executed, as surety, and said Duque & Frazzini as 
principals, a sub-contract bond in favor of Basich 
Brothers Construction Company in the sum of 
$101,745.55, dated February 20, 1945; 


Whereas, Article XI of said contract of date 
February 7, 1945 requires the sub-contractors to 


Basich Brothers Construction Co. 139 


promptly make payment to all persons supplying 
them with labor, materials and supphes for the 
prosecution of the work or in connection therewith 
and in the event the sub-contractor shall not make 
such payments, the prime contractor may make said 
payments and deduct from any moneys due the sub- 
contractor such advancements. 


Whereas, it is provided in the bond of said sub- 
contractor of date February 20, 1945, that the prin- 
cipal and surety agree to pay all just labor claims 
arising under said contract within two weeks after 
demand. 

You, and each of you, are hereby notified that 
said sub-contractors are not paying the just labor 
claims arising under said contract of date February 
7, 1945 and, apparently will encounter difficulty in 
continuing the payment of said labor claims. 


You, and each of you, are hereby notified that 
pursuant to said Article XI contained in said con- 
tract of February 7, 1945, the prime contractor has 
made labor payments, material payments and sup- 
ply payments for said sub-contractors in the past 
for the prosecution of said work but that the 
amount of moneys due the sub-contractors is not 
sufficient to meet the past advancements made by 
the contractor Basich Brothers Construction Com- 
pany; that such deficiency shall be chargeable 
against the sub-contractors and the above surety 
Glens Falls Indemnity Company. As soon as an 
account can be prepared on this matter, the same 
will be submitted to you. 


142 Glens Falls Indemnity Co. vs. 


will pay, among other things, the weekly payrolls 
for labor. You further state, on the second page of 
your said letter of May 24th, that you will pay 
labor claims and charge same to the Surety and 
subcontractors. You [4381] of course realize that 
your chent has no right to charge anything to the 
Surety, as the Surety has no habilty whatever ex- 
cept such liability as may exist under the express 
terms of its bond. 


Your letter of June Ist stated that you had been 
informed that Duque & Frazzini shut down their 
small crusher plant on May 31st. I communicated 
this information to my client, and I am advised by 
Mr. Bray that he has received information from 
the subcontractors that there was a short breakdown 
of the small plant, but satisfactory production has 
been restored. 


After the receipt of your two letters of May 23rd 
and 24th, the writer, with Mr. John Bray, made a 
trip to the job at Tueson, at which time you were 
present, and we were advised by the subcontractors 
and hy your client at the site of the plants crushing 
the rock and making the aggregates, that no time 
has been lost by vour chent because of under pro- 
duction, but on the contrary, there was enough 
material then ahead for several days concrete pour- 
ing. I am therefore unable to understand why your 
client wishes to put in additional equipment to take 
care of extra work when our information received 
from the subcontractors and from your chent is 
to the effect that there has been no shortage what- 


Basich Brothers Construction Co. 143 


ever of aggregates to date. If this is not correct, 
please advise in what particular it is not correct, 
so that I may communicate the information to my 
client. 

Yours very truly, 


J. E. MeCALL. 
J EMcC€ :me 
ee: 2—Glens Falls Indemnity Company 
1—Ralph W. Bilby, Tucson, Arizona [432] 


EXHIBIT No. 5 
[Letterhead John EK. McCall] 
June 23, 1945 


Basich Brothers Construction Company 
c-o Mr. Stephen Monteleone, Attorney 
714 West Olympic Boulevard 

Los Angeles 15, California 


Gentlemen: 


Your letter of June 8th, 1945 addressed to Duque 
& Frazzini and Glens Falls Indemnity Company, 
and your letters of June llth and 14th, 1945 ad- 
dressed to Glens Falls Indemnity Company, have 
been referred to me for attention and reply on be- 
half of the Glens Falls Indemnity Company only. 

I do not represent the subcontractors Duque & 
Frazzini and do not know the full extent of their 
obligations to you, if any, but if you will examine 
the terms and conditions of the surety bond which 


14+ Glens Falls Indemnity Co. vs. 


was posted in this case I am sure you will realize 
that the Glens Falls Indemnity Company is not 
liable to you for any labor or materials or equip- 
ment performed or furnished to said subcontractors 
or anyone else in connection with the job in 
question. 

Your letter of June 8th states that you have re- 
ceived no co-operation from either the subcontrac- 
tors or the surety except ‘‘promises and assur- 
ances.’’ Please advise us what co-operation you 
think you should have received from the surety, 
but which you have not received. I am sure you 
have received no ‘‘promises and assurances’’ other 
than those expressed in the terms of the surety 
bond. Said contract bond contains every condition 
under which you [433] could have a claim or de- 
mand against the surety. 

You further state that you are securing certain 
material and performing certain work which you 
are charging to the principal and surety. We do 
not know what agreement you may have with the 
subcontractors, but we are sure that vou have no 
right to perform or furnish anything, or have any- 
thing performed or furnished and charge the same 
to the surety, and the surety will not recognize any 
claim you may make which is not expressly covered 
by the terms of its conrtact bond. 

Your letter of April 5th, 1945 and several other 
letters received since that date state that the sub- 
contractors did not commence work on the sub- 
eontract on February 19th, 1945 as required by the 
terms of their contract, but your letter of June 11th, 


Basich Brothers Construction Co. 145 


1945 states that you do not know when the sub- 
contractors did commence work on the subcontract 
in question. 

If you have wrongfully taken the contract over, 
as is indicated by your letters, or if you have failed 
to give notice required by the terms of the contract 
bond, or if you have fatled in any other respect to 
perform any of the conditions precedent required 
of you by the terms of the bond, you can have no 
valid claim against the surety. 


Yours very truly, 
J. EK. MeCALL. 
JEMcC :M [434] 


Received copy of the within Answer this 20th day 
of January, 1947. 
STEPHEN MONTELEONE and 
IDRACY J. PRInST, 
/s/ STEPHEN MONTELEONE, 
By /s/ GEORGIA RICHARDS, 
Attorneys for Plaintiff. 


[Endorsed]: Filed Jan. 21, 1947. [485] 


146 Glens Falls Indemnity Co. vs. 
[Title of District Court and Cause. ] 


MEMORANDUM OF DEFENDANT GLENS 
FALLS INDEMNITY COMPANY, A COR- 
PORATION, RE PLAINTIFF’S BILL OF 
PARTICULARS [486] 

Plaintiff’s Bill of Particulars—Schedule I 

Page 

1 Jack Brown—Tractor Driver 

3/17/45 (Sat.) Time Card recorded 814 

hrs. Was paid for 11 hrs. Overpaid 

21% hrs. (Overtime) at $2.25 per hr......$ 5.63 
3/18/45 (Sun.) Time Card recorded 8 

hrs. Was paid for 1614 hrs. Overpaid 

814 hrs. at $2.25 per Br. ............ 1S 4 
4/12/45 (Thurs.) Time Card recorded 13 

hrs. Was paid for 1314 hrs. Overpaid 

Te hewaies2.25 per Nt... E33 
4/20/45 (Fri.) Time Card recorded 6 

hrs. Was paid for 8 hrs. Overpaid 2 

hrs. ateolko0 per hr. 2.........2..-2 3.00 
4/22/45 (Sun.) Time Card recorded 1314 

hrs. Was paid for 184% hrs. Overpaid 5 

his: at. 2825 per hee... a 11.25 
4/23/45 (Mon.) Time Card recorded 6 

hrs. Was paid for 8 hrs. Overpaid 2 

hrs. at Sila0*per hr. 12222... 3.00 
5/6/45 (Sun.) Time Card recorded 1114 

hrs. Was paid for 12 hrs. Overpaid 14 

hr. at @2:2On er” Witgee. | .....cs oe dae 


Basich Brothers Construction Co. 


Page 


12 


4/17/45 (Tues.) Time Card recorded 
2514 hrs. Payment was made on the 
basis of 8 hrs. straight time and 1714 
hrs. overtime, amounting to $51.38. 
Time Card recorded work from 3:00 
pm. on 4/17/45 to 5:00 p.m. on 
4/18/45. Should have been paid for 9 
hrs. less 14 hr. lunch period or 814 hrs. 
on 4/17/45, and for 17 hrs. less 14 hr. 
luneh period or 1614 hrs. on 4/18/45, 


amounting to $44.25. Overpaid................ 


Jack L. Brown—Foreman 

5/18/45 (Fri.) Time Card recorded 1514 
hrs. Was paid for 1714 hrs. Overpaid 
2 hrs. (Overtime) at $2.625 per hr. .... 

Sidney Cohen—Truck Driver 

3/19/45 (Mon.) Time Card recorded 9 
hrs. Was paid for 914 hrs. Overpaid 
Voy ene oe) 0) Ne 

Ray Hurler—Tractor Operator 

0/30/45 (Wed.) Time Card recorded 11 
hrs. Was paid for 12 hrs. Overpaid 1 
NR a eee, CT SI Me. . cen. acx-d ee eee 

Vaughn P. Allred—Truck Driver 

4/27/45 (Fri.) Time Card recorded 1114 
hrs. Was paid for 12 hrs. Overpaid % 
nizeat, 20) per ht... 22 


147 


O.20 


ES) 


2.20 


1) 


148 


Glens Falls Indemnity Co. vs. 


Page 


14 


19 


Clarence Hampton—Plant Foreman 

No lunch period of 4% hr. was deducted 
on the records of this employee on the 
following 61 days: March 20, 24, 25, 
27, 28, 30, 31; April 2, 3, 4, 5) oye 
9, 18, 14, 17, 18, 19, 20, 25, 26.82 
28, 29, 30; May 1, 2, 3, 4, 6, (7 33mee 
10, 11, 12, 14, 15, 16) 47, 18, 193eame 
21, 22, 23, 24, 25, 27, 28, 29, 30) 73m 
June 1, 3, 4, 5, 6, 7, 8. 61 days at 14 
hr. equals 30% hrs. at $2.625 per hr..... 

Frank Mariscal—Laborer 

5/13/45 (Sun.) Time Card recorded 10 
hrs. Was paid for 20 hrs. Overpaid 10 


$80.06 


hrs. at $2.0625 per hm) 222... 20.63 


5/18/45 (Ff ri.) Time Card recorded 1014 
hrs. Was paid for 11 hrs. Overpaid % 
hr at20625 Persil... ee 

0/27/45 (Sun.) Time Card recorded 101A 
hrs. Was paid for 11 hrs. Overpaid 14 
h&cat 62/0625 per hr. Bh... 

5/28/45 (Mon.) Time Card recorded 
1014 hrs. Was paid for 11 hrs. Over- 
paid “oui. at $2:0625 en fr. ee 

5/30/45 (Wed.) Time Card recorded 9 
hrs. Was paid for 914 hrs. Overpaid 
Yo he au S2.0629 penelitiee....... 

6/1/45 (Fri.) Time Card recorded 1014 
hrs. Was paid for 11 hrs. Overpaid 1% 
lie at $2,062 per limes. 0 eee 


1.03 


1.03 


1.03 


1.03 


1.03 


Basich Brothers Construction Co. 149 


Page 
6/7/45 (Thurs.) Time Card recorded 
101% hrs. Was paid for 11 hrs. Over- 
Wards lr, at b2-Co29 er It eee $ 1.03 
6/8/45 (Fri.) Time Card recorded 101% 
hrs. Was paid for 11 hrs. Overpaid 14 
iter 62.0620 emis ae. 1.03 
23 Don Tomany—Truck Driver 
3/13/45 (Thurs. ) This employee was 
paid for 4 hrs. more than he worked. 
Overpaid 4 hrs. at $1.00 per hr. ............ 4.00 
3/24/45 (Sat.) Time Card recorded 10 
hrs. Was paid for 1514 hrs. Overpaid 
Seite) aiyol.o0 perm hy, 152s 8.25 
3/31/45 (Sat.) Time Card recorded 10 
hrs. Was paid for 14 hrs. Overpaid 4 
Inmecmecienbl 00) OG WES eases ne ccetenueeee 6.00 
4/14/45 (Sat.) Time Card recorded 13814 
hrs. Was paid for 19 hrs. Overpaid 
py miGoay pl.00 per hi. 222.2... ee 8.25 
4/15/45 (Sun.) Time Card recorded 
11144 hrs. Was paid for 14 hrs. Over- 
feck 205 hiss at $1.50 per hr, ...222) 3.75 
4/23/45 (Mon.) Time Card reeorded 
1014 hrs. Was paid for 11 hrs. Over- 
Dade jeurteat o1.00 per hit, sie wes 
: 4/25/45 (Wed.) Time Card recorded 
: 101% hrs. Was paid for 11 hrs. Over- 
paid > hi at S150) per hr eee 15 
4/28/45 (Sat.) Time Card recorded 12 
: hrs. Was paid for 1244 hrs. Overpaid 
Woeliimat pteo0 per Wy. sce ccc... 15 


150 Glens Falls Indemnity Co. vs. 


Page 

4/29/45 (Sun.) Time Card recorded 12 

hrs. Was paid for 13 hrs. Overpaid 1 

hr. at $1L.50eper hr... a $ 1.50 
5/3/45 (Thurs.) Time Card recorded 

1114 hrs. Was paid for 12 hrs. Over- 

paid 1% br. at $1.50 per br. ...._ aa 15 
5/4/45 (Fri.) Time Card recorded 1014 

hrs. Was paid for 11 hrs. Overpaid 

Y% hr: at $1.50 per hr. —........... aa 15 
5/5/45 (Sat.) Time Card recorded 2 hrs. 

Was paid for 5 hrs. Overpaid 3 hrs. 

atg$i.50 perm hr: ..:...../0g520.2. 4.50 
5/7/45 (Mon.) Time Card recorded 1014 

hrs. Was paid for 11 hrs. Overpaid 14 

hroat $1007 per hr. ...22........—— “15 
5/8/45 (Tues.) Time Card recorded 1014 

hrs. Was paid for 11 hrs. Overpaid ¥/, 

hr. at $1.50 perch. ........22.22. a 15 
5/9/45 (Wed.) Time Card recorded 1014 

hrs. Was paid for 11 hrs. Overpaid 14 

hin at $1.90 per hiv, .... 2242222 ee mts) 

25 Clyde Burchfield—Crusher Operator— 

4/1/45—Crusher Foreman 
4/3/45 (Tues.) Time Card recorded 11 

hrs. Was paid for 12 hrs. Overpaid 1 

hr2ates2.625 per hi. 72e22....... 2.63 
4/25/45 (Wed.) Time Card recorded 5 

hrs. Was paid for 8 hrs. Overpaid 3 

hes: at) (oqpeT bt. = eee 5.25 
5/8/45 (Tues.) Time Card recorded 714 

hrs. Was paid for 8 hrs. Overpaid 14 

hr, atl, 75 Wereit: ae. .2e eee ee .88 


Basich Brothers Construction Co. Ie 


Page 
26 Chiford Gorby—Oiler 
3/20/45 (Tues.) Time Card recorded 13 
hrs. Was paid for 1314 hrs. Overpaid 
hr. at $1.4625 per br... weiss 
27 Dallas Scott—Tractor Operator 
3/24/45 (Sat.) Time Card recorded 101% 
hrs. Was paid for 11 hrs. Overpaid 14 
ie 62.20 per hres ee... ee. ee. ales: 
32 Thomar O. Mosley—Shovel Operator 
4/23/45 (Mon.) Time Card recorded 11 
hrs. Was paid for 1114 hrs. Overpaid 
Womb peta rouwer WT. 2ce.21--ceee 1.22 
4/29/45 (Sun.) Time Card recorded 12 
hrs. Was paid for 1214 hrs. Overpaid 
ies 2.4010 Pee. 2.2. 2eeee ee: We 
4/30/45 (Mon.) Time Card recorded 
121% hrs. Was paid for 13 hrs. Over- 
paid 1% hr. at $2.4375 per hr. ...............- 1.22 
33 Stacey Wailes—Oiler 
4/8/45 (Sun.) Time Card recorded 1214 
hrs. Was paid for 13 hrs. Overpaid 14 
iiemeat olet625 per hr. 2.2... 73 
4/23/45 (Mon.) Time Card recorded 11 
hrs. Was paid for 1114 hrs. Overpaid 
To hear o4620%per br. a 13 
4/27/45 (Fri.) Time Card recorded 5 
hrs. Was paid for 8 hrs. Overpaid 3 
hrs, at So (oapem lit? .............ee 2.93 
4/30/45 (Mon.) Time Card recorded 
1214 hrs. Was paid for 13 hrs. Over- 
paid 14 hr. at $1.4625 per hr. ............... 13 


152 Glens Falls Indemnity Co. vs. 


Page 
36 Charles Collins—Truck Driver 
4/18/45 (Wed.) Time Card recorded 8 
hrs. Was paid for 1014 hrs. Overpaid 
2% hrs. at $1.50 per hr. _....... $ 3.75 
38 Earl Collins—Truck Driver 
4/20/45 (Fri.) Time Card recorded 9144 
hrs. Was paid for 10 hrs. Overpaid 14 
hr, at $1.50 per ht aS) 
40 Willard Roles— 
Repairman & Crusher Operator 
No lunch period of 144 hr. was deducted 
on the records of this employee on the 
following 48 days: April 5, 6, 10, 18, 
19, 20, 21, 22, 28, 24, 25, 26, 27, 28, 29; 
30; May 1, 2, 3, 4, 6, 7, 9, 11, 12, 133s 
15, 16, 17, 18, 19, 20, 22523) 24a 
26, 27, 29, 30, 31; June 12) eee 
7, 9. 48 days at 4 hr. equals 24 hrs. at 
200625 per hr. 2.0... 49.50 
3/31/45 (Sat.) Time Card recorded 10 
hrs. Was paid for 20 hrs. Overpaid 10 
hirewated2.062) per hie... 2... 20.62 
5/28/45 (Mon.) Time Card recorded 
101% hrs. Was paid for 12 hrs. Over- 
paid 172 hts. at $2.0G2a0per hr. eee 3.09 
6/6/45 (Thurs.) Time Card recorded 
1214 hrs. Was paid for 16 his. Over- 
paid 34% hrs. at $2.0625 per hr. ............ (22 


Basich Brothers Construction Co. 153 


Page 
41 Fred T. Tidwell—Tractor Operator 
No lunch period of 44 hr. was deducted 
on the records of this employee on the 
following 42 days: April 2, 3, 4, 15, 
Hoel lic, 19, 205 Dele, 23, 2o en. 
20,50. May 1, 2, 6, 39) 129s 
Oot 21, 22, 23, 24, 2%, 28, 20a0 
ol; June 1, 2, 3, 4, 5, 7, 8. 42 days at 
14, hr. equals 21 hrs. at $2.25 per hr..... $47.25 
3/27/45 (Tues.) Time Card recorded 8 
hrs. Was paid for 10 his. Overpaid 2 
homes O20 ele NY... 4.50 
42 Raymond W. Aguilar—Laborer 
During the week of 4/15 to 4/21 this em- 
ployee worked only regular hours. 
However, these 6 hours were extended 
at the Overtime rate of $1.3125 in the 
total amount of $7.88. These 6 hours 
should have been extended at the 
Regular rate of $.875 in the total 
amount of $5.25. Difference of _............. 2.63 
45 Antonio J. Espinosa—Laborer 
4/2/45 (Mon.) Time Card recorded 8% 
hrs. Was paid for 9 hrs. Overpaid 4 
ciuaepil mem eR Mee... ---..-0e .66 
4/8/45 (Sun.) Time Card recorded 1114 
hrs. Was paid for 121% hrs. Overpaid 
ite hl 38o pet 2. 35 
4/10/45 (Tues.) Time Card recorded 
111% hrs. Was paid for 1244 hrs. Over- 
paid 1 hr. at $1.85 per hr. W002... 189) 


154 Glens Falls Indemnity Co. vs. 


Page 
4/12/45 (Thurs.) Time Card recorded 
11144 hrs. Was paid for 1214 hrs. Over- 
paid 1 hr, at $1.35 per hr... ea & 135 
4/15/45 (Sun.) Time Card recorded 11144 
hrs. Was paid for 12 hrs. Overpaid 14 
hr. at $1.35 per br. 2... .68 
4/30/45 (Mon.) Time Card recorded 11 
hrs. Was paid for 1144 hrs. Overpaid 
if hr. at $1.85 per hr. .............. = .68 
d/11/45 (Fri.) Time Card recorded 16 
hrs. Was paid for 17 hrs. Overpaid 1 
hi. at $1.30 per hr... 2 1.35 
46 Reinaldo Morgan—Laborer 
4/2/45 (Mon.) Time Card recorded 814 
hrs. Was paid for 9 hrs. Overpaid 14 
he. at $1.3125 per hr, 23.2. .66 
4/8/45 (Sun.) Time Card recorded 1114 
hrs. Was paid for 1214 hrs. Overpaid 
ign. at $1.3125 perro Heil 
4/9/45 (Mon.) Time Card recorded 814 
hrs. Was paid for 9 hrs. Overpaid 4 
hist 61.3125 per ht a .66 
4/10/45 (Tues.) Time Card recorded 10 
hrs. Was paid for 1014 hrs. Overpaid 
1A titeat 1.3125 peri... .66 
4/12/45 (Thurs.) Time Card recorded 
1114 hrs. Was paid for 12% hrs. Over- 
paid 1 hreat $1.3125epertin, ae esa 
4/27/45 (Fri.) Time Card recorded 9 hrs. 
Was paid for 11 hrs. ee 2 hrs. 
at $1.59 peri 2.4 ee 2.70 


Ol 


Basich Brothers Construction Co. 


Page 


47 


49 


50 


5/11/45 (Fri.) Time Card recorded 16 
hrs. Was paid for 17 hrs. Overpaid 1 
meet, DIL SOMCRMNM 2.2... ccaenencecte coe yeceetee 

Silas Salverson—Tractor Operator 

4/22/45 (Sun.) Time Card recorded 1014 
hrs. Was paid for 11 hrs. Overpaid 14 
lgeecienh: 25 per hips... eee 

4/23/45 (Mon.) Time Card recorded 
1114 hrs. Was paid for 12 his. Over- 
jer torbr, at $2.25 per hr................- 

0/14/45 (Mon.) Time Card recorded 5 
hrs. Was paid for 8 hrs. Overpaid 3 
Riemer te ple): CUM. 20.22. ..sc eee ee 

Kenneth EK. Hopkins—Truck Driver 

4/18/45 (Wed.) Time Card recorded 
D144 hrs. Was paid for 8 hrs. Overpaid 
Ze omieis. war $1.00 per hr. 2.22222 

0/2/45 (Wed.) Time Card recorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
emer) DOM eli... eee 

5/10/45 (Thurs.) Time Card recorded 5 
hrs. Was paid for 8 his. Overpaid 3 
ieee OO Sper liteey.....c a ee 

Bill Phillips—Truck Driver 

4/17/45 (Tues.) Time Card recorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
iis atmeleO0 per li) .....2.......... 

0/4/45 (Fri.) Time Card recorded 101% 
hrs. Was paid for 11 hrs. Overpaid 14 
hreat $150 per hr. . 2 aa 


155 


Wells 


4.50 


2.90 


2.00 


3.00 


2.00 


15 


156 Glens Falls Indemnity Co. vs. 


Page 
51 Teodoro M. Rhodecs—Truck Driver 
4/17/45 (Tues.) Time Card recorded 514 
hrs. Was paid for 8 hrs. Overpaid 2144 
hrs. at $1.00. per hr... $ 2.50 
52 Raymond E. Collins—Truck Driver 
0/14/45 (Mon.) Time Card recorded 
1144 hrs. Was paid for 12 hrs. Over- 
paid 4 hiv. at$2.00 per hr. _....... a 15 
53 James EH. Jackson—Truck Driver 
4/17/45 (Tues.) ‘Time Card recorded 
514 hrs. Was paid for 8 hrs. Overpaid 
24% hrs. ate$i,00 per hr. _...........22 2.50 
o4 Samuel A. Moreno—Laborer 
This employee was listed as a Laborer 
but was paid $.90 Regular time and 
$1.35 Overtime. Laborers’ rates are 
$.875 Regular time; $1.3125 Overtime. 
$.025 difference times 192 Regular 


WO ec 2c ccdce 2 4.80 
$.0375 difference times 151144 Over- 
time hrs, <.2...4..... eee. 0.68 


5/18/45 (Fri.) Time Card recorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
hrs. at $90 goer lia... 1.80 
On this page 54 the addition of the 
‘‘Gross Wages’’ column should read 
$383.15 in lieu of $383.45 which amount 
was carried forward to the Summary 
page. Less computation error of $.30 
In footing <colmmin, ge 2. 30 


Basich Brotheis Construction Co. 


Page 


D0 


o6 


D8 


Chester W. Sherman—Tractor Operator 
4/30/45 (Mon.) Time Card recorded 
121% hrs. Was paid for 13% hrs. Over- 
eidebelr aies2.20 per hit. n.e 
5/7/45 (Mon.) Time Card recorded 11 
hrs. Was paid for 1144 hrs. Overpaid 
Poe tt S2.20 per hi. .....nkn. ee. 
5/18/45 (Fri.) Time Card recorded 214 
hrs. Was paid for 4 hrs. Overpaid 114 
JO1GS, ie SHIDO) 0X, let 4 he 
St. Aubin—Truck Driver 
4/28/45 (Sat.) Time Card recorded 121% 
hrs. Was paid for 13 hrs. Overpaid 4 
Tiuommed oper Wry -.....2-. cece 
0/2/45 (Wed.) Time Card recorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
[toes es e110) 0) oye) 0 eae een ne 
0/11/45 (Fri.) Time Card recorded 7 
hrs. Was paid for 8 hrs. Overpaid 1 
hitememepteOOn per Ni, .......2..2 22 ee 
Frank Basurto—Laborer 
This employee was listed as a Laborer. 
Was paid $.90 Regular time and $1.35 
Overtime. Laborers’ rates are $.875 
Regular time and $1.38125 Overtime. 
$.025 difference times 64 Regulai 
JOINS." gahslis 6 re 1.60 
$.0375 difference times 5314 Overtime 
lias. 


157 


1d 


2.00 


1.00 


158 Glens Falls Indemmty Co. vs. 


Page 
59 Ira T. Buchanan—Laborer 
3/29/45 (Tues.) Time Card recorded 
101%5 hrs. Was paid for 11 hrs. Over- 
paid 14 hr. at €io) pershp,........ 2a € .68 
6/5/45 (Tues.) Time Card recorded 
10% hrs. Was paid for 11 hrs. Over- 
paid 14 hme at $1.35 per fir: _..... ae .68 
This employee was listed as a Laborer. 
Was paid $.90 Regular time and $1.35 
Overtime. Laborers’ rates are §.875 
Regular time and £1.3125 Overtime. 
$.025 difference times 184 Regular 


MINS 0s. eee... eee 4.60 
$.0375 difference times 14514 Overtime 
i ee ae... 1B. a 5.46 


60 Joe M. Chavez—Truck Driver 
5/2/45  (Wed.) Time Card t1ecorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
hee: atjl.00 per he. _..........2... ee 2.00 
5/7/45 (Mon.) Time Card recorded 6 
hrs. Was paid for 8 hrs. Overpaid 2 
Laie site SINOO yoet IR. we. eee 2.00 
63 Garland D. England—Truck Driver 
5/28/45 (Mon.) Time Card recorded 744 
hrs. Was paid for 8 hrs. Overpaid % 
he, ate@iQ0 per lit. ec... 0 
65 Sena Penrod—Truck Driver 
5/19/45 (Sat.) Time Card recorded 2 
hrs. Was paid for 4 hrs. Overpaid 2 
his..at S990" poe ee 3.00 


Basich Brothers Construction Co. 159 


Page 
66 Richard J. Rojas—Truck Driver 
5/8/45 (Tues.) Time Card recorded 
1214 hrs. Overpaid 2 hrs. at $1.50 per 
“iggy Ne ee: REE $ 3.00 
67 Arthur Smith—Laborer 
This employee was listed as a Laborer 
but was paid 2.90 Regular time and 
£1.35 Overtime. Laborers’ rates are 
$.875 Regular time; 21.5125 Overtime. 
$.0375 difference times 9 Overtime hrs. 34 
68 Victor E. Vasquez—Dumpman 
5/3/45 (Thurs.) Time Card recorded 
614 hrs. Was paid for § hrs. Overpaid 
ie low am WOO goer wat. _..................- 1.35 
71 R. Williams—Mechanic. Heavy Duty 
5/22/45 (Tues.i Time Card recorded 14 
hrs. Was paid for 1445 hrs. Overpaid 
tT hf. at $210625 ver Wir. _..............--- 1.05 
5/27/45 (Sun.) Time Card recorded 12 
hrs. Was paid for 1214 hrs. Overpaid 
te Vit) al @20C25 per hr. ..................-.... 1.03 
5/30/45 (Wed.) Time Card recorded 11 
hrs. Was paid for 11445 hrs. Overpaid 
i hv. wh 62.062 per hr. ....................... 1.08 
6/2/45 (Sat.) Time Card recorded 12). 
hrs. Was paid for 13 hrs. Overpaid 1s 
be same GROGE ower HT... 1.03 
6/4/45 (Mon.) Time Card recorded 1445 
hrs. Was paid for 15 hrs. Overpaid ta» 
Br Weete2-0625 Per br. _.......-. 1.03 


160 


Page 


Glens Falls Indemnity Co. vs. 


73 James L. Hill—Tractor Operator 
0/29/45 (Tues.) Time Card recorded 714 


hrs. Was paid for 8 hrs. Overpaid % 
hr. at $1.50 per hr 


75 William O. Kirkpatrick—Truck Driver 
During the week 5/13 to 5/19 the hours 


worked as listed on this page are 8 hrs. 
Regular and 4 hrs. Overtime. 8 hrs. at 
Regular rate of $1.00 per hr. equals 
$8.00. 4 hrs. at Overtime rate of $1.50 
per hr. equals $6.00. $8.00 plus $6.00 
equals $14.00. The extension for this 
week is listed as $30.00. Error in ex- 
tension ($30.00 less $14.00) ............-2..- 


76 John R. Roberts—Truck Driver 
0/14/45 (Mon.) Time Card recorded 414 


hrs. Was paid for 8 hrs. Overpaid 344 
hrs, at $1.00 per hi. 22 ae 


77 Dana H. Burnett—Oiler 
0/22/45 (Tues.) Time Card recorded 13 


hrs. Was paid for 1314, hrs. Overpaid 
VY hr. at $1.4625 per hr 


81 Raymond 8S. Martinez—Laborer 
This employee was listed as a Laborer 


but was paid $.90 Regular time and 
$1.85 Overtime. Laborers’ rates are 
$.875 Regular time; $1.3125 Overtime. 
$.025 difference times 104 Regular hrs. 
$.0375 difference times 87 Overtime 
hrs. 


3.00 


Basich Brothers Construction Co. 


Page 


82 


84 


90 


96 


97 


Otha G. McCoy—Truck Driver 

0/18/45 (Fri.) Time Card recorded 514 
hrs. Was paid for 8 hrs. Overpaid 214 
Wem at S100 per br... kee. 

Otiractous Burehfield—Dumpman 

0/23/45 (Wed.) Time Card recorded 
1014 hrs. Was paid for 1114 hrs. Over- 
anc demwat loo per Wry 2c. 

Jack F. Merrill—Spotter 

0/28/45 (Mon.) Time Card recorded 11 
hrs. Was paid for 12 hrs. Overpaid 1 
Vigil, iy GL SS1a 050 cer 

Leslie MeDaniel—Tractor Operator 

On February 19, 1945, this man operated 
the P. D. O. C. *‘Carryall’’ the rental 
of which was charged for that same 
day to Duque & Frazzini on a Fully 
Operated basis on Schedule X. This 
charge for time is a duplication ............ 

Rex McCoy—Maintainer Operator 

On February 20, 21 and 22, 1945, this 
man operated during all of those three 
days the P. iD. ©. C.“ R. U. Carryall” 
the rental of which was charged for 
that same time to Duque & Frazzini on 
a Fully Operated basis on Schedule X. 
This charge for time is a duplication 


General 


Plaintiff has not exhibited to defendant 
evidence that these labor payments 
were proper. 


161 


1 


Oo. 


315) 


(6) 


162 


Page 


Glens Falls Indemnity Co. vs. 
Schedule IT 


3 Hutchins—welder 
This employee was listed as a Welder 


but was paid $1.75 Regular time and 
$2.625 Overtime. Welders’ rates are 
$1.3875 Regular time and $2.0625 Over- 
time. $.5625 difference times 4 Over- 
time hrs... 23 a. ee 


4 David Leon—Laborer 
This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 362 Regu- 


Te ET 


$.1875 difference times 34444 Overtime 
VRS! outh ancl. Cee 


9 John Smith—Laborer 
This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
£1.50 Overtime. Laborers’ rates are 
S.875 Regular time and $1.3125 Over- 
time. $.125 difference times 394 Regu- 
laa VS) cn tS eee... 
$.1875 difference times 383 Overtime 
HESS 2..eed ee: 


45.25 


49.29 


Page 
6 Frank Topia 


16 


Basich Brothers Construction Co. 


Laborer 


This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50. Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 360 Regu- 


163 


lene NTSC), en cree eye $45.00 


$.1875 difference times 375 Overtime 
hrs. 


Lew Stephenson—Mechanic 
This employee was listed as a Mechanic 


but was paid $1.50 Regular time and 
$2.25 Overtime. Mechanics’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.125 difference times 16 Regu- 
ue JS) 2 nnenree ss en 
$.1875 difference times 9 Overtime hrs. 


Andrew Thomas—Laborer 
This employee was listed as a Laborer 


but was paid $.95 Regular time and 
$1.425 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.075 difference times 16 Regular 
NTS Ro coc 
$.1125 difference times 6 Overtime hrs. 


164 Glens Falls Indemnity Co. vs. 


Page 
19 Luther Hart—Mechanie 

This employee was listed as a Mechanic 
but was paid $1.50 Regular time and 
$2.25 Overtime. Mechanics’ rates are 
$1.375 Reeular time and $2.0625 Over- 
time. $.125 difference times 2 Regular 
HrSo* ee eee ee, $ 
€.1875 difference times 11 Overtime 
LS. “oes t eeeeee nets .2, ee 

On 4/23/45 the Overtime 8 hrs. of this 
emplovee was charged to Duque & 
Frazzini, Regular time on this same 
day for Basich Bros. 

On 4/26/45 the Overtime 3 hrs. of this 
emplovee was charged to Duque & 
Frazzini, Regular time on this same 
day for Basich Bros. 

20 Feliciano Talavera—Laborer 

This employee was listed as a Laborer 
but was paid $.90 Regular time and 
$1.35 Overtime. Laborers’ rates are 
#875 Regular time and $1.3125 Over- 
time. 
$.025 difference times 8 Regular hrs. 
$.0375 difference times 144 Overtime 
TVS reo ie 


Basich Brothers Construction Co. 165 


Page 
23 Manuel Villareal—Laborer 
On 5/2/45 (Wed.) this employee’s Regu- 
lar time of 7 hrs. was entered on Ba- 
sich Bros. payroll sheets twice, and the 
14 hrs. were added into the total 334, 
hrs. Regular time for that week. This 
extra 7 hrs. at $.875 per hr. amounts 
to $6.12. Basich Bros. apparently 
eaught this error before issuing the 
payroll check, and paid this employee 
for the correct $49.44 or $6.12 less than 
the $55.56 charged to Duque & Fraz- 
zini. Overcharge 
24 Anthony Lesnett—Mechanie 
This employee was listed as a Mechanic 
but was paid $1.50 Regular time and 
$2.25 Overtime. Mechanics’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.1875 difference times 1 Over- 
IROOM rn 9 sc oc ics.-4ic-aveceses's-ooc-0esscet ee all) 
General 
Plaintiff has not exhibited to defendant 
evidence that these labor payments 
were proper. 


166 


Page 


Glens Falls Indemnity Co. vs. 
Schedule IIL 


2 Jesus Fimbres—Oiler 


6/10/45 (Sun.) Time Card recorded 121% 


hrs. Was paid for 14 hrs. Overpaid 
1 brs. at $1.4625 per hr... aaa 


6/11/45 (Mon.) Time Card recorded 


1114 hrs. Was paid for 1314 hrs. Over- 
paid 2 hxs. at $1:-4625"per hr. aa 


6/15/45 (Fri.) Time Card recorded 13 


hrs. Was paid for 14144 hrs. Overpaid 
114 hrs, at $1.4025 per hte... 


3. David Leon—Laborer 


4 Raymond Martinez 


This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$875 Regular time and $1.3125 Over- 
time. $.125 difference times 360 Regu- 
VeggaAIPS,. 2.........-...gnge ee 
$.1875 difference times 48714 Overtime 
TAT Seale Sew... od kr 


Laborer 

This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 440 Regu- 
VEG gu GS ee 8 en se 
$.1875 difference times 470 Overtime 
TDS. c.ocsageetee eee. do ee 


2.93 


2.19 


45.00 


50.00 


Basich Brothers Construction Co. 167 


Page 
6 John Smith—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 469 Regu- 


Iie NSPS $58.63 
$.1875 difference times 527 Overtime 
THUS, 22 oe 98.81 


7 Frank Topia—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 1386 Regu- 


LLL EOS) et ee rr 17.00 
$.1875 difference times 19714 Overtime 
EUS, apace rr eee 2 37.03 


10 Ted Drew—Shovel Operator 

This employee was listed as a Shovel 
Operator but was paid $1.75 Regular 
time and $2.625 Overtime. Shovel Op- 
erators’ rates are $1.625 Regular time 
and $2.4375 Overtime. $.125 difference 
emerns Wveeular hrs. ..............---.sse 1.00 
$.1875 difference times 2 Overtime hrs. — .38 


168 Glens Falls Indemnity Co. vs. 


Page 
11 Allen Faust—Oiler 
This employee was listed as an Oiler but 
was paid $1.25 Regular time and 
$1.875 Overtime. Oilers’ rates are $.975 
Regular time and $1.4625 Overtime. 
$.275 difference times 8 Regular hrs..... 
$.4125 difference times 214 Overtime 
VS. - zcccacte cee tetece eee eee 
13° Fred Hutchins—Welder 
This employee was listed as a Welder 
but was paid $1.75 Regular time and 
82.625 Overtime. Welders’ rates are 
$1.3875 Regular time and $2.0625 Over- 
time. $.375 difference times 10 Regular 
GIS). ice seeoeee atone sicdese ee er 


NTS. 2 Ae ee oe 
15 Charles Stitt—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 216 Regu- 
bar’ iS). .:..4:2. eee... 
$.1875 difference times 19044 Overtime 
HVS. Jasco eo 


$ 2.20 


27.00 


Basich Brothers Construction Co. 169 
Page 
18 Zetti Swinney—Laborer 
This employee was listed as a Laborer 
but was paid $.95 Regular time and 
$1.425 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.075 difference times 328 Regu- 
LOY lit’ cere oo $24.60 
$.1125 difference times 212 Overtime 
MS. 2 nie ieee 23.85 
21 Mitar Janicich—Laborer 
This employee was listed as a Laborer 
but was paid $1.125 Regular time and 
$1.6875 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.25 difference times 176 Regular 
YS, eo nee Race: 2s 44.40 
$.375 difference times 13314 Overtime 
IES, soccer sas I 50.06 
24 Gabriel Albiso—Laborer — 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.38125 Over- 
time. $.125 difference times 152 Regu- 
LG? ORS. ne nininerier ee 19.00 
$.1875 difference times 13614 Overtime 
ANG foo coc sae eccecoeceoei--t-c 25.67 


io 


Glens Falls Indemnity Co. vs. 


Page 
25 Andre Thomas—Laborer 


23 


26 


27 


This employee was listed as a Laborer 
but was paid $.95 Regular time and 
$1.425 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.075 difference times 120 Regu- 


lar Yrs. 22: 22e.-cccecteeerteectee cee rr $ 9.00 


$1125 difference times 7914 Overtime 
HPS. focicedeet seeds ser 

Enearnation Valerio—Laborer 

This employee was listed as a Laborer 
but was paid $1.125 Regular time and 
$1.6875 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.375 difference times 10 Over- 
WMG DIS. oc. .cceccccccnendens ents ee 

Henry Haskin—Laborer 

This employee was listed as a Laborer 
but was paid $.95 Regular time and 
$1.425 Overtime. Laborers’ rates are 
$.875 Regular time and $1.5125 Over- 
time, but the differences were below 
$1.00 in total. 

Joe Hayes—Laborer 

This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$875 Regular time and $1.3125 Over- 
time, but the differences were below 
$1.00 in total. 


3.19 


Basich Brothers Construction Co. aval 


Page 
28 Enguirque Salas—Laborer 
This employee was listed as a Laborer 
but was paid $95 Regular time and 
$1.425 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time, but the differences were below 
$1.00 in total. 
34 David Mazon—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 56 Regular 


TOTES. sci ee ere $ 7.00 
$.1875 difference times 5614 Overtime 
tis WO 205 oo 5 sd a Sree 10.59 


30 ©Feliciano Talavera—Lahorer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 48 Regular 


TOW, sueskeond yesh ri eRe er 5 2c 6.00 
$.1875 difference times 3444 Overtime 
OS, Gis. Ak nee SE” 6.47 


36 Jose Verdugo—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 8 Regular 


$.1875 difference times 2 Overtime hrs.  .38 


172 Glens Fails Indemnity Co. vs. 


Page 
37 Joe McDaniels—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 32 Regular 


WPS. thei. cs oe eer $ 4.00 


$.1875 difference times 28 Overtime 
JAHESS 0. -coccseneedeto cee 


38 Bob Black—Mechanic 
This employee was listed as a Mechanic 
but was paid $1.75 Regular time and 
$2.625 Overtime. Mechanics’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.5625 difference times 8 Over- 
MIMe WS) 0... ee 
39 Howard Robinson—Mechanic 
This employee was listed as a Mechanic 
but was paid $1.50 Regular time and 
$2.25 Overtime. Mechanics’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.125 difference times 22144 Regu- 
late WS. es... eee 
$.1875 difference times 27 Overtime 
130 ee! A Se. 
40 Samuel Wilson—Laborer 
This emplovee was listed as a Laborer 
but wes paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 


4.50 


2.81 


Bastch Brothers Construction Co. 


time. $.125 difference times 40 Regular 


173 


| Tec Rae $ 5.00 


$.1875 difference times 11144 Overtime 


ime ge sc ae wis ba cd ON ee oa a es 


General 
Plaintiff has not exhibited to defendant 


evidence that these labor payments 
were proper. 


Schedule IV 


8 Raymond Lucas—Shovel Operator 
6/9/45 (Sat.) This employee operated 


the PD. O. C. Shovel No. 108, the 
rental of which was charged for the 
same day to Duque & Frazzini on a 
Fully Operated basis, Schedule XIX. 
Dupheation of 11 hrs. Overtime at 


5 AT) TOle)O 100 Ba) en ee ene re 26.81 


15 Maksin Pesko—Labover 
This emplovee was listed as a Laborer 


but was paid from 6/10 to 6/16 at the 
rates of $1.125 Regular time and 
$1.6875 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.25 difference times 8 Regular 
istic Rus 8 Se oo). ct 
$.375 difference times 12 Overtime hrs. 


La 


174 Glens Falls Indemnity Co. vs. 


Page 
19 Fred Hutchins—Welder 
This employee was listed as a Welder 

but was paid $1.75 Regular time and 
$2.625 Overtime. Welders’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.3875 difference times 1 Regular 
Li nee ee ee $ 38 
$.5625 difference times 4 Overtime hrs. 2.25 


General 
‘Plaintiff has not exhibited to defendant 
evidence that these labor payments 
were proper. 


Sehedule V 


2 Enearnation Valero—Laborer 
This employee was listed as a Laborer 
but was paid $1.125 Regular time and 
$1.6875 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.375 difference times 10 Over- 
time hrs. 
4 Vance Evans—Laborer 
This employee was listed as a Laborer 
but was paid $.90 Regular time and 
$1.35 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.025 difference times 120 Regu- 
larwhts.- Ge eee... a 3.00 
$.0375 difference times 7014 Overtime 
brs. cc... ee 2.64 


Basich Brothers Construction Co. 175 


Page 
6 Joe Hayes—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $125 difference times 16314 


CETUS ha er $20.44 
$.1875 difference times 95 Overtime 
IVS. tee etl oe Re 17.81 


9 Feliciano Talavera—Laborer 
This employee was listed as a Laborer 
but was paid from 6/10 to 8/25 at the 
rates of $90 Regular time and $1.35 
Overtime. Laborers’ rates are $.875 
Regular time and $1.3125 Overtime. 
$.025 difference times 156 Regular hrs. 3.90 
$.0375 difference times 93 Overtime 
|DIDAS aeRO 2) ot RUG A ree Cen he 3.49 
11 Lew Stevenson—Mechanic & Fireman 
This employee was listed as a Mechanic 
& Fireman but was paid $1.50 Regular 
time and $2.25 Overtime. Mechanics’ & 
Firemen’s rates are $1.375 Regular 
time and $2.0625 Overtime. $.125 


difference times 131 Regular hrs. ........ 16.38 
$.1875 difference times 9314 Overtime 
[NUS | Syne es Se 2 NN 17.53 


176 Glens Falls Indemnity Co. vs. 


Page 
17 David Mason—Laborer 
This employee was lhsted as a Laborer 
but was paid from 6/10 to 8/25 at the 
rates of $.90 Regular time and $1.35 
Overtime. Laborers’ rates are $.875 
Regular time and $1.3125 Overtime. 


$.025 difference times 96 Regular hrs... $ 2.40 


$.9375 difference times 70 Overtime 
HWS). 222 eS ee 

18 Tom Harmon—Laborer 
This emplovee was listed as a Laborer 
put was paid at the rates of $.95 Reeu- 
lar time and $1.465 Overtime. Labor- 
ers’ rates are $.875 Regular time and 
$1.3125 Overtime. $.075 difference 
times 8 Regular hrs. ............2....—— 
$.1525 difference times 3 Overtime hrs. 

19 Fred Hutchins—Welder 
This emplovee was listed as a Welder 
but was paid $1.75 Regular time and 
$2.625 Overtime. Welders’ rates are 
$1.375 Regular time and $2.0625 Over- 
time. $.375 difference times 11 Regular 
isis eee. a 


HS nee os, 
23 Benny Dixon—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 33 Regular 
YS. 42n1.1i ae 


.60 
.46 


Page 
24 Clarence Williams 
This employee was listed as a Laborer 


26 


30 


Basich Brothers Construction Co. 


Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 33 Regular 


177 


[his See ee ee een ey $ 4.13 


$.1875 difference times 13 Overtime 
JOR, © ee ein ene er en RNID? CN 


Eddie Byas—Laborer 
This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.1875 difference times 9 Over- 
ICSE LTS > ARE Se 


Raymond Martinez—Laborer 
This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 8 Regular 


$.1875 difference times 2 Overtime hrs. 


Eugene Miller—Laborer 
This employee was listed as a Laborer 


but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 16 Regular 


$.1875 difference times 4 Overtime hrs. 


178 Glens Falls Indemnity Co. vs. 


Page 
31 Samuel Wilson—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 8 Regular 
VS). cdi ee $ 1.00 
$.1875 difference times 3 Overtime hrs. .56 
32 Samuel Forrest—Laborer 
This employee was listed as a Laborer 
but was paid $1.00 Regular time and 
$1.50 Overtime. Laborers’ rates are 
$.875 Regular time and $1.3125 Over- 
time. $.125 difference times 8 Regular 
1 ae oe MR 1.00 
$.1875 difference times 2 Overtime hrs.  .38 


General 
Plaintiff has not exhibited to defendant 
evidence that these labor payments 
were proper. 


Schedule VI as Amended 


Plaintiff has not exhibited to defendant evidence 
of authority for the rating used in computing 
Workmen’s Compensation charges. 

Plaintiff has not exhibited to defendant evidence 
to show [465] that Duque & Frazzini were protected 
in any way by a Public Liability and Property 
Damage policy under which charges are made, 
$611.09. 


Basich Brothers Construction Co. 179 


Comments on Schedules I to V_ illustrate that 
all charges in Schedule VI as amended are cdm- 
puted on incorrect totals. 


Schedule VII 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the sub- 
contract work or to charge any amounts to the 
defendant. | 

Schedule VIII 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the sub- 
contract work or to charge any amounts to the 
defendant. 

Schedule [LX 


Plaintiff has not exhibited to defendant records 
of production measurements for this equipment on 
which royalty charges are based, as per contract 
between plaintiff and Duque & Frazzini, dated May 
1, 1945, defendant’s Exhibit ‘‘B’’. 


This Schedule shows royalty charges for sand 
production on the basis of 995 tons. Schedule XVII 
shows royalty charges for sand production on the 
basis of 2,223 tons, a total of 3,218 tons of sand. 
The credit allowed for sand production in Schedule 
XXXXIV (XLIV), however, is 751 tons of sand. 


180 Glens Falls Indemnity Co. vs. 


Schedule X 
Page 
1 4/5/45 Time card recorded 10% hrs. for 
Dozer 428. Payment for 8 hrs. Regu- 
lar time and 414 hrs. Overtime. Over- 
paid 2 hrs. at $10.20 per hr. ._..._ $20.40 
Comments on Schedule I, pp. 96 and 97, 
indicate duplication of labor charge 
where, carryall was listed on a fuliy 
operated basis. Plaintiff has not ex- 
hibited to defendant evidence showing 
authority to use the equipment on the 
subcontract work or to charge any 
amounts to the defendant. 


Schedule XI 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the sub- 
contract work or to charge any amounts to the 
defendant. 

Schedule XII 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the sub- 
contract work or to charge any amounts to the 
defendant. 

Schedule XIII 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the sub- 
contract work or to charge any amounts to the 
defendant. [467] 


Basich Brothers Construction Co. 181 
Sehedule XIV 


Plaintiff has not exhibited to defendant evidence 
showing authority to use the equipment on the 
subcontract work or to charge any amounts to the 
defendant. 

Schedule XV 


Plaintiff charged Duque & Frazzini the standard 
rate for this equipment which apparently includes 
profit. 

Schedule XVI 


Plaintiff charged Duque & Frazzini the standard 
rate for this equipment which apparently includes 
profit. 

Schedule XVII 


Plaintiff charged Duque & Frazzini the standard 
rate for this equipment which apparently includes 
profit. 

Plaintiff has not exhibited to defendant records 
of production measurements for this equipment on 
which royalty charges are based. 

See also comments on Schedule IX. 


Schedule XIX 


Comments on Schedule IV, p. 8, indicate duplica- 
tion of labor charge where Shovel No. 108 was 
listed on a fully operated basis. [468] 


Schedule XX 


Plaintiff has not exhibited to defendant records 
of production measurements for this equipment on 
which royalty charges are based. 


182 Glens Falls Indemnity Co. vs. 


Schedule X XI 
Page 
1 6/30/45 J. G. North’s yellow time 
sheets and Mr. Thompson’s 
Journal book recorded 99 truck 
hrs. Payment for 17914 truck 
hrs. Overpaid 80% hrs. at $4.13 
per br? 2S re £332.47 
3 8/22/45 J. G. North’s yellow time 
sheets recorded 56 truck hrs. 
Payment for 77 truck hrs. 
Overpaid 21 hrs. at $4.13 per 
Ee, st $86.73 


Schedule XXIT 


Invoices from Phoenix Tempe Stone to Plaintiff 
of $2,761.58 for the use of this equipment were not 
on a fully operated basis. Plaintiff charged Duque 
& Frazzini $6,102.05, the standard rate for fully 
operated equipment which apparently includes 
profit. 

Schedule XXIV 


Two bins rented for 2 months and 23 days. 
Plaintiff charged Duque & Frazzini for 3 
full months. Overcharged 7 days at $90.00 
per Month 2.9 ee £21.00 


Schedule XX VI 


Plaintiff has not exhibited to defendant evidence 
showing authority to repair the equipment or to 
charge any amounts to defendant. 


Bastch Brothers Construction Co. 183 


Schedule XXVIT 
Plaintiff has not exhibited to defendant evidence 
showing authority to purchase parts for the equip- 
ment or to charge any amounts to defendant. Plain- 


tiff has not exhibited to defendant evidence showing 


the equipment on which such parts were used. 


Schedule XXVIII 


Plaintiff has not exhibited to defendant evidence 
showing authority to use parts from plaintiff’s 
stock or to charge any amounts to defendant. Plain- 
tiff has not exhibited to defendant evidence showing 
the equipment on which such parts were used. 


Schedule XXIX 


Plaintiff has not exhibited to defendant evidence 
showing authority to issue fuel, grease and oil for 
equipment or to charge anv amounts to defendant. 
Plaintiff has not exhibited to defendant evidence 
showing where such fuel, grease and oil were used. 


Schedule XXX 


Plaintiff has not exhibited to defendant evidence 
showing authority for moving and setting up the 
Pioneer Crusher, Tueson Mac E. Eng., providing 
accounting services, telephone charges or authority 
to charge any amounts to defendant. [470] 


Schedule XX XT 


Plaintiff has not exhibited to defendant evidence 
showing authority to pay freight on equipment or 
to charge any amounts to defendant. The absence 
of dates on this Schedule prevents vouching to 
specific invoices. 


184 Glens Falls Indemnity Co. vs. 
Schedule XXXIT 


Plaintiff has not exhibited to defendant evidence 
showing the equipment on which such repairs were 
made. 

Schedule XXXITT | 


Plaintiff has not exhibited to defendant evidence 
showing the equipment on which the parts were 
used. 

Schedule XXXIV 


No dates were given on this Schedule. Plaintiff 
has not exhibited to defendant evidence showing 
authorty to use parts from plaintiff’s stock or to 
charge any amounts to defendant. Plaintiff has 
not exhibited to defendant evidence showing the 
equipment on which such parts were used. 


Schedule XX XV 


Plaintiff has not exhibited to defendant evidence 
showing the equipment on which such fuel, grease 
and oil were used. 


Schedule XXNNVI 


Plaintiff has not exhibited to defendant evidence 
of authority for the rating used in computing 
Workmen’s Compensation charges. [471] 


Schedule XXXVII 


Plaintiff has not exhibited to defendant evidence 
showing authority to pay freight on equipment or 
to charge any amounts to defendant. The absence 
of dates on this Schedule prevents vouching to 
specific invoices. 


Basich Brothers Construction Co. 185 


The iully Operated Shovel 37B, owned by 
Phoenix Tempe Stone Co., was left for plaintiff’s 
use on the express condition that there should be 
no freight charge to Duque & Frazzini for its 

STOPES ee eee Se $360.50 


schedule XX XVIII 


The total quantity in this schedule should be 
54,864 c.y., not 54,764 cy. 
«UY Ge che GTR Cr 4 ee Add $46.00 


Schedule XXXIN 


Article X XII, Item 11 of the alleged subcontract, 
Plaintift’s Exhibit ‘‘1’’ provides as follows for 
this Item. ‘‘Measurement to be computed on truck 
water level.’’? Measure for purposes of credit to 
Duque & Frazzini is made by this Schedule dividing 
square yards in place by 15. 

Further, this Schedule does not credit Duque & 
Frazzini with 32,751 sq. yd. as shown on U. 8. 
Engineers’ Estimates No. 138 Extension, June 15 to 
July 31, 1945, Defendant’s Exhibit ‘*D.”’ 


Schedule XX XXIT (XLIT) 


Engineers’ Estimates for Items No. 26A and 266 
were 24,500.16 tons, Defendant’s Exhibit ‘“D.”’ 
Plaintiff has not exhibited to Defendant evidence 
of authority to deduct oil tonnage or evideuse £472] 
that oil tonnage deductions are not included in the 
Engineers’ Estimates. Difference of 841.81 tons 
2) (OS) Love (10 re Add $547.18 


186 Glens Falls Indemnity Co. vs. 
Schedule XX XRIW (XLV) 
See comments on Schedule LX. 


Received copy of the within memorandum this 
31st day of January, 1947. 


STEPHEN MONTELEONE and 
TRACY J. PRIEST, 
By STEPHEN MONTELEONE, 
Attornevs for Plaintiff. 


[Endorsed]: Filed Feb. 4, 1947. [473] 


[Title of District Court and Cause. ] 


DECISION AND ORDER FOR 
JUDGMENT AND FINDINGS 


The above-entitled cause, heretofore tried, argued 
and submitted, is now decided as follows: 

Judgment will be for the plaintiff and against 
defendants as prayed for in the Complaint, the 
exact amount to be computed under Local Rule 
7(g) by counsel for the plaintiff, in conformity 
with the corrected bill of particulars as finally 
proved at the trial of the cause. 

Findings and Judgments to be prepared by coun- 
sel for the plaintiff under Local Rule 7. 

T am of the view, after a full consideration of the 
ease in the light of the additional testimony intro- 
duced on February 4th and 5th, 1947, that the 
plaintiff is entitled to recover and that the evidence 


Basich Brothers Construction Co. 187 


does not sustain any of the defenses which have 
been raised by the averments in the [474] Answer 
or as legal propositions based upon the facts as 
a whole. 

Ordinarily, no other direction would be necessary. 
However, because of the nature of the case, and 
the desire for a quick determination, and in order 
to avoid any dispute as to the certain special issues 
arising in the case, I indicate, as I have done re- 
peatedly in cases of this character, certain special 
findings and conclusions. These relate particularly 
to the defenses interposed either by specific allega- 
tions or urged as legal principles. They are stated, 
in the main, in the order in which they appear in 
the affirmative defenses, although the particular 
defenses may not necessarily be referred to in each 
instance. 


So Jey ibacele 
iL. 

The Complaint states a claim upon which relief 
ean be granted and the evidence fully establishes 
such claim. 

Ee 

The defendant surety company has had notice of 
anv and all complaints, deficiencies and failures in 
the performance of the contract by Duque & Fraz- 
zini, the obligee and subcontractor, of which the 
plaintiff complains. 

eel 

Prior to the final abandonment of the work by 

Duque & Frazzini on June 8, 1945, notice of which 


188 Glens Falls Indemnity Co. vs. 


was given on the same day by letter to the surety 
and obligee, various complaints had been brought 
to the attention of the surety of deficiencies in the 
work. They sent a representative who had access to 
all the books and who sought to secure the improve- 


ment of conditions. 4 
IV. 


On the final abandonment of the work on June 8, 
1945, immediate notice was given to the suretv and 
obligee [475] of such abandonment and of previous 
complaints about the nature of the work. In said 
letter request was made for full performance by 
them and notice given that any action to he taken 
by the plaintiff was merely to minimize damage. 
No offer to perform was made by the surety. Nor 
did thev request the plaintiff to desist from con- 
tinuing the work in order to minimize damage, until 
adjustment or until the surety company chose to 
take over further performance. On the contrary, 
the surety’s answer to that and subsequent letters— 
especially the letter of the counsel for the snrety, 
dated June 23, 1945—merely referred to the con- 
tract as the measure of their Hiahilitv. And, while 
notifvine the plaintiff that the snrety ‘‘will not 
recognize anv claim (thev) mav make which is not 
expressly covered by the terms of its contract 
hond,’’ it, at no time, asked a cessation of labor or 
indicated a desire to take over performance of the 
contract of the obligee. Under the circumstances, 
the defendant cannot claim that it was not given an 
opportunity to proceed with performance, as it 
alleges in the third affirmative defense. 


Bastch Brothers Construction Co. 189 


Vv. 


Plaintiff has performed faithfully with the con- 
dition of the contract of surety and has not violated 
any of the conditions of the subcontract. More par- 
| ticularly, with reference to the allegations of the 
j} fourth affirmative defense, I find, as expressed 
orally at the conclusion of the trial, that the ar- 
rangement whereby the plaintiff paid direct to the 
laborers their wages earned from the obligee upon 
weekly payrolis furmshed and certified to by the 
obligee, was not a violation of the terms of the 
contract, but was an arrangement made for the 
benefit of the obligee which inured also to the 
benefit of the surety who had knowledge of the 
fact, as their representative not onlv had [476] 
access to the payrolls and books, but actually had 
-examined them during the period in which the 
| payments were being made. 

For like reason, the surety cannot complain and 
was not injured by the fact that the emplovees of 
the obligee were carried on the plaintiff’s rolls for 
the purpose of imecome tax withholding, social 
security and unemplovment insurance returns, 
workmen’s compensation policies, public lability 
and property damages. Nor can surety complain 
because the plaintiff rented directly to, or through 
others for the benefit of, the obligee, equipment 
needed by them in the performance of the contract. 
As to all these, the evidence shows conclusively that 
the arrangement was made for the benefit of the 
obligee. that the amounts paid out were upon the 
order of the obligee and were the reasonable value 


190 Glens Falls Indemnity Co. vs. 


of the services and materials secured and the equip- 
ment furnished. No profit was charged against the 
obligee on any of these advances, and where the 
equipment furnished was owned by plaintiff, the 
charge was the regular OPA charge which it has 
also been shown without contradiction to be 
reasonable. 


NEL. 


No payments have been made to the contractor 
other than called for by the subcontract by the 
plaintiff and the obligee. While it is true that some 
payments were made for labor, materials and the 
like, before any actual payments were due to the 
subcontractor, these were merely in the form of 
bookkeeping entries showing charges and advances 
made for the benefit of the obligee. At no time did 
the sums so advanced exceed the progress pay- 
ments and if the last charges and advances did so 
exceed the progress payment, it is merely because 
upon the abandonment of the contract, the surety 
did not choose to take over the contract [477] for 
completion and the plaintiff was compelled to com- 
plete the same. 

All these facts were known to the surety who 
had access to the books and actually investigated 
them. Under the circumstances, there was no con- 
cealment of which the surety can complain. 


Vie 


I find that the plaintiff has not, at any time, by 
any act which it did prior or subsequent to June 8, 
1945, waived or abandoned its right to demand full 


Basich Brothers Construction Co. 191 


performance of the contract. In this respect, I find 
specifically that the arrangement whereby the pay- 
ments set forth in Finding V were made did not 
constitute in Jaw a change in the terms of the 
contract or an alteration in the relationship be- 
tween the plaintiff and the obligee affecting the 
rights of the surety. Also, that it is not true, as 
alleged in the eighth affirmative defense, that the 
plaintiff did, at any time, control or direct the 
employees of the obligee, but that, on the contrary, 
they were, at all times until the abandonment of 
the work, under the sole and exclusive control of 
Duque & Frazzini or their agents. Consequently, 
although the contract of the surety is, as 1 deter- 
mined previously, at the hearing of November 25, 
1946, to be governed by California law, there has 
been no deviation in its terms which can he called of 
substance. On the contrary, its terms have been 
complied with substantially by the plantiff and the 
obligee, and such deviations as were made as to 
advances or manner of computing work did not 
change the contract in any substantial manner, and 
were made with the consent of the obligee and for 
their benefit and the benefit of the surety, and that 
the surety had actual knowledge or means of knowl- 
edge, and by failing to raise anv objection [478] 
waived a more strict compliance. 


IDS. 


I find that not only do the facts show a waiver 
in the matters just referred to, but that the entire 


192 Glens Falls Indemnity Co. vs. : 


conduct of the surety amounts to waiver of per- 

formance of the conditions of which they complain 

in the special defenses and as to all other matters. | 
‘ 


xX. | 


In all their negotiations, the conduct of the 
surety in dealing with any complaints which came | 
to their attention, even after the abandonment, was 
such that they lulled the plaintiff into a feeling of 
security that efforts were being made to adjust the 
differences and that no affirmative action was forth- 
coming on the part of the surety. An attitude lke 
this is like the “‘indulgence’’ extended to one after 
a complaint of fraud is made and which results in 
delay of rescission. He who induces such indulgence 
is not in a position to complain of it. (Noll v. 
Baida, 1927, 202 C. 105, 108: Hunt v. LO ayia 
Ine., 1927, 202 C. 701, 704.) 


So the plaintiff here is entitled to a finding of 
waiver and estoppel as pleaded in the amendment 
to the complaint, filed on December 28, 1946. 


Dated this 11th day of February, 1947. 


Jxf/ LEON R. YVANK WICH 
United States District Judge. 
Counsel notified. 


fEundorsed]: Filed Feb. 11, 1947. [479] 


Basich Brothers Construction Co. 193 


piitle of District Court and Cause. ] 


FINDINGS OF FACT AND 
CONCLUSIONS OF LAW 


The above entitled action came on regularly for 
trial in the District Court of the United States, 
Southern District of California, Central Division, 
before the Honorable Leon R. Yankwich, Judge 
presiding, on the 25th day of November, 1946, and 
thereupon regularly continued for further proceed- 
ings which were had on the 4th dav and oth day 
of. February, 1947, Stephen Monteleone, Esq., and 
Tracy J. Priest, Esq., appearing as attorneys for 
plaintiff, Basich Brothers Construction Company, 
a corporation, and John EK. McCall, Esq., appearing 
as attorney for the [480] defendant, Glens Falls 
Indemnity Company, a corporation; (defendants 
Andrew Duque and Carson Frazzini, co-partners, 
doing business under the name of Duque & Frazzini, 
not having been served with summons and not 
having appeared, the trial proceeded against the 
defendant, Glens Falls Indemnity Company, a cor- 
poration, alone). 

A jury trial having been duly waived by the 
respective parties, the cause was tried before the 
Court without a jury, whereupon evidence, both 
oral and documentary, was introduced by and on 
behalf of said plaintiff Basich Brothers Construc- 
tion Company, a corporatoin, and said defendant 
Glens Falls Indemnity Company, a corporation, 
respectively, and the Court having heard and con- 


194 Glens Falls Indemnity Co. vs. 


sidered said evidence, together with the argument 
of respective counsel for said plaintiff and said 
defendant, and being fully advised in the premises, 
now makes its Findings of Fact and Conclusions of 
Law as follows: 


Findings of Fact 
I. 


The Court finds that each, every and all allega- 
tions contained in Paragraphs I, H, JII and IV 
of plaintiff’s complaint on file herein are true. 


JOU 


The Court finds that on the 25th day of January, 
1945, said plaintiff, Basich Brothers Construction 
Company, a corporation, hereinafter referred to 
as ‘‘ Basich,’’ entered into a certain written contract 
with the United States of America by and through 
the Engineering Department thereof, for the fur- 
nishing of materials and performing of work for 
the construction of taxiways, warm-up and parking 
aprons, airfield lighting, drainage facilities and 
water service lines, together with appurtenant fa- 
cilities necessary [481] at what is known as Davis- 
Monthan Airfield near Tueson, Arizona, said con- 
tract being known as No. W-04-353-Eng-1302 and 
having job No. Davis-Monthan E.S.A. 210-6, 210-8 
and 210-9. 


} 


Basich Brothers Construction Co. 195 


ei, 

The Court finds that on the 7th day of February, 
1945, said plaintiff, ‘‘Basich’’ and said Duque & 
Frazzini entered into a written subcontract for the 
performance of certain work and the furnishing 


of certain material as set forth in said subcontract, 


a true copy of which said subcontract is attached 
to plaintiff’s said complaint, marked Exhibit ‘‘A”’ 
and made a part thereof, and was received in evi- 
dence as plaintiff’s Exhibit 1; that the work to be 
performed and the material to be furnished under 
said subcontract by said Duque & Frazzini were 
essential to the performance by plaintiff of the 
work required to be performed under said contract 


with the United States of America. 


LY. 


The Court finds that on February 20, 1945, and 
in conformity with the requirements of Article 


XXII of said subcontract, defendant, Glens Falls 


Indemnity Company, a corporation, hereinafter 
referred to as “Glens Falls,’’ for a valuable con- 


sideration paid to it as a premium, made, executed 
_and delivered to plaintiff within the Southern Dis- 


trict of California, Central Division, a subcontract 
bond in the penal sum of $101,745.55, whereim said 
Duque & Frazzini, as principal, and said defend- 


ant, Glens Falls, as surety are, by the terms thereof, 


held and firmly bound unto plaintiff, Basich, for 


the faithful performance of the work to be done 


under the terms of the aforesaid subcontract be- 
tween plaintiff and said Duque & Frazzini. 


196 Glens Falls Indemnity Co. vs. 


That a true copy of said subcontract bond is 
attached to plaintiff’s complaint, marked Exhibit 
‘*B”’ and made a part thereof and was received in 
evidence as plaintiff’s Exhibit 2; that on March 7, 
1945, defendant, Glens Falls, modified in writing 
said bond by adding thereto the following: ‘‘It is 
hereby understood and agreed that the 10 days 
appearing in Paragraph ‘First’ is changed to read 
twenty (20) days.’’ 

V. 


The Court finds that the aforesaid subcontract 
between plaintiff and said Duque & Frazzini and 
the aforesaid subcontract bond executed by the 
defendant, Glens Falls, as surety, constitute the 
agreement between plaintiff and said Duque & 
Frazzini and said defendant, Glens Falls. The Court 
finds that it was the intention of the parties that 
provisions of said subcontract to be performed by 
said Duque & HFrazzini were and are obligations 
included within the obligations of said subcontract 
bond. 

Woe 


The Court finds that at all times herein mentioned 
following the execution and delivery of said bond 
by defendant, Glens Falls, to plaintiff, Basich, as 
aforesaid, said bond remained in full force and 
effect and still is in full force and effect. 


Basich Brothers Construction Co. 197 


VIL. 


The Court finds that plaintiff has fully done and 
performed each and every act in its part to be 
performed under the terms of said subcontract and 
said subcontract bond and has fully done and com- 
plied with each and every condition precedent 
therein contained required of it to be performed by 
said subcontract and said subcontract bond in order 
to entitled plaintiff to recover from said defendant, 
Glens Falls, for all losses sustained by said plain- 
tiff by reason of the failure of said Duque & 
Frazzini to faithfully perform the requirements 
of said subcontract as found in these Findings of 
ac 

VIII. 


The Court finds that each and every allegation 
contained in Paragraph IX of said complaint is 
true. [483] 

TEXS: 


The Court finds that said Duque & Frazzini en- 
tered upon the performance of the requirements 
of their said subcontract with plaintiff, but failed 
to prosecute said work therein required of them 
continuously with sufficient workmen and/or equip- 
ment, or to erect two plants each canable of pro- 
ducing 800 cubic yards of suitable material a day 
and that after commencing work under said sub- 
contract and, on or about April 5, 1945, said Duque 
& Erazzini failed to have or thereafter to maintain 
sufficient workmen and/or sufficient equipment as 
in said subcontract required of them. 


198 Glens Falls Indemnity Co. vs. 
X. 


The Court finds that said Duque & Frazzini after 
they commenced work, as required in said sub- 
contract, failed to pay labor or equipment or mate- 
rial bills, hereinafter specifically found, on account 
of labor performed and/or materials and/or equip- 
ment furnished to them in connection with the 
performance of said subcontract with plaintiff and 
further said Duque & Frazzini failed to faithfully 
perform the work and requirements therein con- 
tracted to be done as herein specifically found. That 
on account of the failure of said Duque & Frazzini 
to perform faithfully the work contracted to be 
done as in said subcontract specified, plaimtiff did, 
under date of April 5, 1945, by registered mail, 
notify said defendant, Glens Falls, and said Duque 
& Frazzini that the plant of said Duque & Frazzini 
was not producing 800 cubic yards of suitable ma- 
terial as required in said subcontract and that 
Duque & Frazzini move in additional equipment to 
insure proper completion of their said subcontract. 
That the notice given to said defendant, Glens 
Falls, as aforesaid, constituted notice to said de- 
fendant as required by the terms of said subcontract 
bond. [484] 

XI. 


The Court finds that said Duque & Frazzini there- 
after continued to work under said subcontract with 
plaintiff until its final abandonment on June 8, 
1945, and that said defendant Glens Falls, following 
said notice of April 5, 1945, through its duly au- 


Basich Brothers Construction Co. 199 


thorized agents and representatives, fully investi- 
gated the facts and conditions relative to said com- 
plaint in said notice contained and was thereby 
fully advised of all of the facts thereto pertaining. 


XII. 


The Court finds that on or about April 27, 1945, 
said Duque & Frazzini, having still failed to faith- 
fully perform the work contracted to be done under 
said subcontract with plaintiff, plaintiff did, under 
date of April 27, 1945, by registered mail, notify 
said defendant, Glens Falls, and said Duque & 
Frazzini of the failure of said Duque & Frazzini 
to faithfully perform the work required of them 
under said subcontract and that plaintiff would 
make all reasonable efforts, either in attempting to 
procure sufficient equipment to produce the defi- 
ciency in material required of said Duque & Fraz- 
zini under said subcontract, or attempt to procure 
the deficiency of materials through other sources 
and make all charges or other reasonable expenses 
in connection therewith against said defendant, 
Glens Falls, and said Duque & Frazzini. 


XII. 


The Court finds that plaintiff, upon acquiring 
knowledge of any and all failures of Duque & Fraz- 
zini to comply with any of the provisions of the 
subcontract, properly complied with all conditions 
precedent of the bond and gave notice thereof to 
defendant, Glens Falls, in the manner and within 


200 Glens Falls Indemnity Co. vs. 


the time in said bond provided and that said de- 
fendant, Glens Falls, was afforded an opportunity 
by plaintiff in accordance with the condition prece- 
dent of said bond to see that the provisions of the 
subcontract [485] were complied with. 


SOL 


The Court finds that plaintiff, at no time, waived 
any of its rights, nor did it at any time elect to 
perform, nor did it perform any act inconsistent 
with the conditions of the subcontract bond or the 
right of said plaintiff to collect upon said bond for 
all losses occasioned by the subcontractor’s default. 

XV. 

The Court finds that from the commencement of 
said work by said Duque & Frazzini under said sub- 
contract up to and until the abandonment thereof 
on June 8, 1945, plaintiff paid direct to laborers 
employed by said Duque & Frazzini wages of said 
laborers earned from said Duque & Frazzini upon 
weekly payrolls furnished and certified to by said 
Duque & Frazzini in the amounts hereinafter spe- 
cifically found and also paid Workmen’s Compen- 
sation Insurance, Arizona Unemployment Reserve 
Commission, Federal Old Age and Excise Tax in 
the amounts hereinafter specifically found; that 
each and all of said payments were required to be 
made by said Duque & Frazzini under said sub- 
contract and were made by plaintiff, as aforesaid, 
in accordance with an arrangement provided in 
said subcontract for the benefit of said Duque & 


Basich Brothers Construction Co. 201 


Hrazazini and which also inured to the benefit of 
said defendant, Glens Falls, who had, at all times 
herein mentioned, knowledge of the manner and 
amounts of said payments. 

The Court finds that from the commencement of 
said work by Duque & Frazzini under said sub- 
contract until the abandonment thereof on June 8, 
1945, plaintiff rented direct to, or through others 
for the benefit of said Duque & Frazzini and on the 
orders of said Duque & Frazzini, certain equip- 
ments, in the amounts hereinafter found, and also 
sold direct to, or through others for the benefit of 
said Duque & Frazzini, and on the orders of said 
Duque & Frazzini, certain supplies and material, 
in the amounts hereinafter [486] specifically found. 


Xe 


The Court finds that all of the labor, surance, 
equipment, supphes, materials and other items here- 
inabove specified furnished or paid by plaintiff for 
the benefit of said Duque & Frazzini were neces- 
sary for and were actually employed by said Duque 
& Frazzini in the performance of said subcontract 
and the respective amounts thereof for each and 
every item was and is reasonable and fair. 


XVII. 


The Court finds that the amount of labor, insur- 
ance, rentals on equipment, material supplies and 
other items paid or furnished by plaintiff for the 
benefit of said Duque & Frazzini as hereinabove 


202 Glens Falls Indemnity Co. vs. 


found, are fully, correctly and specifically set forth 
in the Bill of Particulars and Amendments thereto 
as corrected on file herein and consist of the follow- 
ing general subject and amount, to-wit: 


Payroll tor labon..22..........2 $47,174.32 
nsuraiice. sweeter cc 6,202.74 
Equipment mentale... 24,438.70 
SS Up Ley a eee eco ce 8,130.74 
Oirae total ole eee ee estes $85,946.50 


The Court finds that each and all of the above 
items and all of the above items were and are 
reasonable and were necessarily expended in the 
performance of said subcontract work, as aforesaid 
and that the said respective sums are the actual 
payments made by plaintiff for the account of said 
Duque & Frazzini or the reasonable rental value 
of the equipment furnished said Duque & Frazzini 
in the performance of said subcontract as herein- 
above found. 

Sy a: 


The Court finds that during the period of time 
from the [487] commencement of said work by said 
Duque & Frazzini under said subcontract up to the 
abandonment thereof on June 8, 1945, said Duque & 
Frazzini had earned, under said subcontract with 
plaintiff a gross amount of $56,080.11 all of which 
amount is fully, correctly and specifically set forth 
in said Bill of Particulars on file herein. The 
Court therefore finds that said Duque & Frazzini 
and defendant, Glens Falls are entitled to credit 
up to the date of the abandonment of said subcon- 


Basich Brothers Construction Co. 203 


tract on June 8, 1945, in said sum of $56,080.11, 
leaving a balance due, owing and unpaid on said 
8th day of June, 1945, from said Duque & Frazzini 
and said defendant, Glens Falls, in the principal 
sum of $29,866.39, together with interest thereon 
at the rate of seven per cent per annum from the 
8th day of June, 1945, on account of the facts herein 
found. 
DIG 


The Court finds that on June 8, 1945, before the 
completion by Duque & Frazzini of the work pro- 
vided for in said subcontract with plaintiff, said 
Duque & Frazzini notified plaintiff in writing that 
they were suspending their said operation and 
thereupon and on said 8th day of June, 1945, with- 
out the consent of plaintiff, and without any fault 
on the part of plaintiff, said Duque & Frazzini 
finally and completely abandoned said work; that 
said defendant, Glens Falls, was, at all times, 
promptly notified by registered mail of the afore- 
said acts and omissions of said Duque & Frazzini 
and upon the abandonment of said operations on 
June 8, 1945, plaintiff thereupon and on June 1], 
1945, notified said defendant, Glens Falls, by reg- 
istered mail that, as surety of said Duque & Fraz- 
zini, it take such action as it may deem proper and 
that until it did so plaintiff, as Prime Contractor, 
upon demand of the War Department, would pro- 
ceed with the work for the benefit of said Duque & 
Frazzini and said defendant Glens Falls, and would 
comply with their reasonable instructions. That 


204 Glens Falls Indemnity Co. vs. 


said defendant, Glens Falls, however, took no ac- 
tion whatever in the completion of the work aban- 
doned by said Dugue & Frazzini, as aforesaid, and 
plaintiff was compelled to complete the same. 

The Court finds that said plaintiff did, at its 
own expense, furnish all necessary labor, material 
and equipment to complete, and did complete the 
work covered by its said subcontract with Duque & 
Frazzini after the same was abandoned, as afore- 
said; that plaintiff necessarily and actually ex- 
pended the amounts and furnished labor, material, 
machinery and equipment in completing said sub- 
contract after said abandonment thereof all of 
which are fully, correctly and specifically set forth 
in said Bill of Particulars and the said amendment, 
as corrected, and consist of the following general 
subject and amounts: 


Pasycoll tor labor 2... 2a =e $ 18,284.16 
AVS UANICO | o...<2:.-::1sc2 cee 2,021.44 
Biguipmnent rental = 7eeeeeeee es 79,612.65 
Repairs, parts, supplies and 
miscellaneous labor ................-- 15,052.11 
Or a toralmamouniol = eee $115,470.36 
XX. 


The Court finds that each, every and all of said 
above items were necessarily and actually expended 
by plaintiff in completing the work agreed to be 
done and performed by Duque & Frazzini after the 
abandonment thereof, as aforesaid, and the said 
respective sums were and are the reasonable and 


Basich Brothers Construction Co. 205 


fair cost thereof and the actual cost to plaintiff of 
labor, materials, supplies, rental and equipment 
necessarily required in the completion of said sub- 
contract for the account of said Duque & Frazzini, 
subcontractor. 

LOL 


The Court finds that said Duque & Frazzini and 
defendant, Glens Falls, are entitled to a credit of 
$65,753.84 on account of the gross earnings based 
on the subcontract price which would have been 
due said Duque & Frazzini from the date of said 
abandonment [489] on June 8, 1945, had they fully 
performed the said subcontract work. That there 
is, therefore, a further balance due, owing and un- 
paid from said Duque & Frazzini and defendant, 
Glens Falls, to plaintiff by reason thereof in the 
principal sum of $49,716.52 together with interest 
thereon at the rate of seven per cent per annum 
from the date of the completion of said work on 
September 25, 1945, on account of said subcontrac- 
tor’s default and abandonment of said work on 
June 8, 1945. That said principal sum of $49,716.52 
together with interest thereon at seven per cent per 
annum from September 25, 1945, is the actual loss 
to plaintiff by reason of the subcontractor’s aban- 
donment of said work, as aforesaid. 


DOLL. 


The Court finds that by reason of the default of 
said Duque & Frazzini, as herein found, and by 
reason of their failure to faithfully perform said 


206 Glens Falls Indemmty Co. vs. 


subcontract in accordance with the terms, as herein 
found, plaintiff has suffered a loss in the total prin- 
cipal sum of $79,582.91, together with interest as 
hereinabove found. That although said Duque & 
Frazzini and defendant, Glens Falls, and each of 
them have been requested to pay said principal and 
interest, they have failed and refused to pay the 
same or any part thereof and the whole of said 
principal sum and interest is due, owing and un- 
paid. 
OE 005 


The Court finds that each and every affirmative 
allegation set forth in the First Amended Answer 
of defendant, Glens Falls, are untrue, except as in 
these findings are expressly found to be true. 


XXIV 


The Court finds that plaintiff’s complaint states 
a claim upon which relief can be granted and the 
evidence fully establishes such claim. [490] 


XXV. 


The Court finds that each and every allegation 
set forth in the second and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue except as in these findings 
are expressly found to be true. 


XXXVI. 


The Court finds that each and every allegation 
set forth in the third affirmative defense of the 


Bastch Brothers Construction Co. 20% 


First Amended Answer of defendant, Glens Falls, 
are untrue except as in these findings expressly 
found to be true. It is true plaintiffs, after sub- 
contract work was abandoned by Duque & Frazzini 
on June 8, 1945, completed all work remaining to 
be done under said subeontract but the completion 
thereof by plaintiff, as aforesaid, was for the ac- 
count of said Duque & Frazzini. The Court finds 
that on the final abandonment of the subcontract 
work by Duque & Frazzini on June 8, 1945, notice 
was properly and promptly given to said defend- 
ant, Glens Falls, and request therein made of it 
for full performance by said defendant and said 
Duque & Frazzini of said subcontract and that any 
action taken by plaintiff was merely to minimize 
damages and the Court finds the same to be a facet. 
The Court further finds that no offer was there- 
upon or thereafter made by either said Duque & 
Frazzini or said Glens Falls to so perform, nor did 
either of them request plaintiff to desist from con- 
tinuing the completion of said work in order to 
- minimize damages until said defendant, Glens Falls, 
chose to take over further performance. 


XXVII. 


The Court finds that each and every allegation 
set forth in the fourth and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue, except as in these findings 
are expressly found to be true. It is true plaintiff 
earried all the men who performed the subcontract 
work [491] on its own payroll, named itself as em- 


208 Glens Falls Indemnity Co. vs. 


ployer of the men who performed the subcontract 
work in all income tax withholding, social security 
and unemployment insurance returns, Workmen’s 
Compensation and Public and Property liability 
policies on the work being performed by Duque & 
Frazzini, but the Court finds, in this respect, that 
arrangements were made therefor within the sub- 
contract for the benefit of Duque & Frazzini which 
said benefit inured to defendant, Glens Falls and 
were not in violation of said subcontract. 


AV UE 


The Court finds that each and every allegation 
set forth in the fifth and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue, except as in these findings 
are expressly found to be true. 


DOOD. 


The Court finds that each and every allegation 
set forth in the sixth and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue, except as in these findings 
are expressly found to be true. It is true said sub- 
contractor did not commence producing material 
on or before the 19th day of February, 1945, but 
did commence operation prior thereto in connection 
with the installation of their plant necessary for 
producing material under said subcontract. 

The Court finds that while it is true that some 
payments were made by plaintiff for the account 
of said Duque & Frazzini for labor, material and 


Bastch Brothers Construction Co. 209 


the like, before actual payments were due to the 
subcontractor, these were merely in the form of 
bookkeeping entries showing charges and advances 
made for the benefit of said subcontractor. 


XXX. 


The Court finds that each and every allegation 
set forth in the seventh and separate affirmative 
defense of the First [492] Amended Answer of de- 
fendant, Glens Falls, are untrue, except as in these 
findings are expressly found to be true. The Court 
finds that any excess payment made by plaintiff 
over the progress payment, after the abandonment 
of said subcontract work by Duque & Frazzini on 
June 8, 1945, or any supervision or direction of 
production of materials by plaintiff following said 
abandonment was because of the abandonment of 
said work and the failure of defendant, Glens Falls 
to take over the completion thereof as hereinabove 
specifically found. 

XXXI. 

The Court finds that each and every allegation 
set forth in the eighth and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue, except as in these findings 
are expressly found to be true. 


BOOG UT 


The Court finds that each and every allegation 
set forth in the ninth and separate affirmative de- 
fense of the First Amended Answer of defendant, 
Glens Falls, are untrue, except as in these findings 
are expressly found to be true. 


210 Glens Falls Indemnity Co. vs. 


XXXII. 


The Court finds that although defendant, Glens 
Falls, was fully advised by plaintiff and also 
through investigations made by its duly authorized 
representatives, of all payments made by plaintiff 
and manner of making same and amount thereof 
for the benefit of said Duque & Frazzini and of the 
amounts earned under said subcontract, as herein- 
above found, and although it was also fully advised 
of all defaults on the part of said Duque & Fraz- 
zini known to said plaintiff, although it was ad- 
vised of the abandonment of said subcontract by 
Duque & Frazzini and of the action of plaintiff in 
completing said subcontract as hereinabove found, 
defendant, Glens Falls, at no time, advised plain- 
tiff that it, said plaintiff, had no authority or right 
to do any of said acts [493] or that on account 
thereof, defendant, Glens Falls intended to or 
would disavow any liabilitv under said subcontract 
bond. The Court finds that by reason of the con- 
duct and acts of said defendant, Glens Falls, as 
hereinabove found, and all of the facts and cir- 
cumstances as disclosed by the evidence, defendant 
Glens Falls, the surety, waived its right to plead 
or assert any alleged failure on the part of plaintiff 
to comply with any of the condition precedent set 
forth in said subcontract bond as alleged in its 
First Amended Answer and the separate and 
affirmative defenses therein contained. 


Bastch Brothers Construction Co. 2 


XXXIX. 

The Court finds that for the same reason said 
defendant waived its right to plead or assert any 
failure on the part of plaintiff to comply with any 
of said condition precedent contained in said sub- 
contract bond as found in said Finding XX XIII, 
it also is estopped from asserting or pleading any 
such right as against plaintiff. 


Conclusions of Law 


As conclusions of law from the foregoing Find- 
ings of Fact, the Court concludes: 


ile 

That plaintiff, Basich Brothers Construction 
Company, a corporation, is entitled to have and 
recover of and from the defendant, Glens Falls In- 
demnity Company, a corporation, the sum of 
Seventy-nine Thousand Five Hundred Eighty-two 
and 91/100 Dollars ($79,582.91), together with in- 
terest on $29,866.39 of said amount at the rate of 
seven per cent per annum from June 8, 1945, to 
the date of rendition of judgment herein and in- 
terest on $49,716.52 of said amount at the rate of 
seven per cent per annum from September 25, 1945, 
to the date of rendition of judgment [494] herein, 
together with its costs of suit incurred herein. 

Let Judgment be entered accordingly. 

Done in Open Court this 7th day of March, 1947. 

/s/ LEON R. YANKWICH, 
Judge. 

Approved as to form as provided in Local Rule 
T (Qe "SSUES Secor. 

[Endorsed]: Filed March 10, 1947. [495] 


212 Glens Falls Indemnity Co. vs. 


In the District Court of the United States, Southern 
District of California, Central Division 


No. Civ. 5021—Y 


BASICH BROTHERS CONSTRUCTION(CGRS 
PANY, a corporation, 
Platmniithe 
VS. 


GLENS FALLS INDEMNITY COMPANY, a 
corporation, and ANDREW DUQUE and 
CARSON FRAZZINT, co-partners, doing busi- 
ness under the name of DUQUE & FRAZZINI, 

Defendants. 


JUDGMENT 


The above entitled action came on regularly for 
trial in the District Court of the United States, 
Southern District of California, Central Division, 
before the Honorable Leon R. Yankwich, Judge 
presiding, on the 25th day of November, 1946, and 
thereupon reguarly continued for further proceed- 
ings which were had on the 4th day and 5th day 
of February, 1947, Stephen Monteleone, Esq., and 
Tracy J. Priest, Esq., appearing as attorneys for 
Basich Brothers Construction Company, a corpo- 
ration, and John EK. McCall, Esq., appearing as 
attorney for the defendant, Glens Falls Indemnity 
Company, a corporation; (defendants Andrew 
Duque and Carson Frazzini, co-partners, doing 


Basich Brothers Construction Co. os 


business under the name of Duque & Frazzini, not 
having been served with summons and not having 
appeared, the trial proceeded against the defendant, 
Glens Falls Indemnity Company, a corporation, 
alone. ) 

A jury tiial having been duly waived by the re- 
spective parties, the cause was tried before the 
Court without a jury, whereupon, evidence, both 
oral and documentary, was introduced by and on 
behalf of said plaintiff Basich Brothers Construc- 
tion Company, a corporation, and said defendant, 
Glens Falls Indemnity Company, a corporation, re- 
spectively, being fully advised in the premises, the 
Court having made, signed and filed herein Decision 
and Order for Judgment and Findings and also 
its Findings of Fact and Conclusions of Law: 


Now, Therefore, It Is Ordered, Adjudged and 
Decreed that plaintiff herein, Basich Brothers Con- 
struction Company, a corporation, have and recover 
of and from defendant herein, Glens Falls Indem- 
nity Company, a corporation, the sum of Seventy- 
nine Thousand Five Hundred Eighty-two and 
91/100 Dollars ($79,582.91), together with interest 
on $29,866.39 of said principal amount from June 
8, 1945, and interest on $49,716.52 of said principal 
amount from September 25, 1945, to and including 
February 28, 1947, said interest amounting in the 


214 Glens Falls Indemnity Co. vs. 


sum of $8557.49, together with plaintiff’s costs of 
suit herein incurred in the sum of $216.80. 


Done in Open Court this 7th day of March, 1947. 


LEON R. YANKWICH, 
Judge. 


Approved as to form as provided in Local Rule 


Tay. 


Judgment entered March 10, 1947. Docketed 
March 10, 1947, C. O. Book 42, Page 115. 
EDMUND L. SMITH, Clerk, 
By /s/ EK. N. FRANKENBERGER, 
Deputy. [497] 


Memorandum of Amount of Interest on of After 
March 1, 1947, until rendition of Judgment 


The daily interest on the total principal of the 
Judgment in the amount of $79,582.91 is $15.26 a 
day. [498] 

Received copy of the within Judgment this 27th 
day of February, 1947, at one o’clock p.m. 

/3s/ JOHN E. McCALL, 
Attorney for Defendant 
Glens Falls Indemnity 
Company. 


[Endorsed]: Filed March 10, 1947. [499] 


Basich Brothers Construction Co. 215 
[Title of District Court and Cause. ] 


NOTICE OF APPEAL 


To Edmund L. Smith, Clerk of Said Court, to 
the .Plaintiff Above Named, and to Stephen 
Monteleone, Esq., and Tracy J. Priest, Esq., 
Its Attorneys: 

Notice Is Hereby Given that defendant Glens 
Falls Indemnity Company, a corporation, hereby 
appeals to the Cireuit Court [500] of Appeals for 
the Ninth Circuit from the final judgment entered 
in this action in Civil Order Book 42 at Page 115, 
on the 10th day of March, 1947, and from the whole 
thereof. 


Dated this the 15th day of May, 1947. 
/s/ JOHN EH. McCALL, 


Attorney for Appellant and Defendant Glens Falls 
Indemnity Company, a corporation. 


[Endorsed]: Filed and mailed copy to Stephen 
Monteleone, Attorney for Plaintiff, May 16, 1947. 


oe 


[Title of District Court and Cause.] 


STATEMENT OF POINTS ON WHICH 
APPELLANT INTENDS TO RELY 


To Edmund L. Smith, Clerk of Said Court, to 
the Plaintiff Above Named, and to Stephen 
Monteleone, Esq., and Tracy Priest, Ksq., Its 
Attorneys: 


216 Glens Falls Indemnity Co. vs. 


Appellant Glens Falls Indemnity Company, a 
corporation, one of the defendants above named, 
intends to rely in its appeal from the whole of the 
final judgment given, made and entered in the 
above-entitled action, upon the following points: 


1. The trial court erred in finding that appellee 
complied with all the conditions precedent contained 
in the bond. 

2. The trial court erred in finding that appellee 
gave to appellant notice of default on the part of 
the subcontractor, in the manner and within the 
time required by the terms of the bond. 


3. The trial court erred in finding that the sub- 
contractor commenced work as required in the sub- 
contract. 

4. The trial court erred in finding that appel- 
lee’s letter of April 5, 1945, constituted notice of 
default as required by the terms of the bond. 


). The trial court erred in finding that appellee 
coniplied with the condition precedent of the bond 
that appellant have the right within thirty days 
after receipt of notice, to proceed or procure 
others to proceed with the performance of the sub- 
contract. 

6. The trial court erred in finding that the com- 
pletion of the subcontract work by appellee after 
June 8, 1945, was merely to minimize damages. 


7. The trial court erred in finding that appellee 
has performed every act on its part to be performed 
under the terms of the subcontract. 


Basich Brothers Construction Co. DAG 


8. The trial court erred in finding that appellee 
retained the last payment payable and all reserves 
and deferred payments retainable under the terms 
of the subcontract. 


9. The trial court erred in finding that appellee 
did not conceal from appellant the fact that the 
subcontractor was in default at the time the bond 
was accepted. 

10. The trial court erred in finding that the sub- 
contract was not altered without the knowledge and 
consent of appellant. [503] 


11. The trial court erred in finding that appellee 
did not pay to or for the account of the subcontrac- 
tor in excess of ninety per cent of engineers esti- 
mate and ninety per cent of useable materials in 
stockpile. 

12. The trial court erred in finding that appellee 
did not pay to or for the account of the subcon- 
tractor sums in excess of the amount due under 
the subcontract. 

13. The trial court erred in finding that appellee 
did not take over and control and supervise the 
subcontract work. 

14. The trial court erred in finding that the pay- 
ments made by appellee were in accordance with 
provisions of the subcontract. 


15. The trial court erred in finding that the 
carrying by appellee on its own employee rolls and 
naming itself as employer of the men who per- 
formed the subcontract work was within the terms 
of the subcontract. 


218 Glens Falls Indemnity Co. vs. 


16. The trial court erred in finding that appellee 
did not make premature payments to or for the 
account of the subcontractor. 


17. The trial court erred in finding that appellee 
did not make payments to the subcontractor on 
aceount of the subcontract work before any pay- 
ment was due under the terms of the subcontract. 


18. The trial court erred in finding that pay- 
ments made by appellee for the account of the sub- 
contractor, before actual payments were due, were 
merely bookkeeping entries. 


19. The trial court erred in finding that the pay- 
ments made by appellee to or for the account of 
the subcontractor inured to the benefit of appellant. 


20. ‘The trial court erred in finding that appellee 
did not waive any of its rights, nor elect to perform, 
nor perform any act inconsistent with the condi- 
tions of the bond. [504] 


21. The trial court erred in finding that appel- 
lant waived compliance by appellee with conditions 
precedent in the bond. 


22. The trial court erred in finding that appel- 
lant had knowledge of the manner or amount of 
payments made by appellee. 


23. The trial court erred in finding that appel- 
lant was fully advised of all defaults on the part 
of the subcontractor known to appellee. 


24. The trial court erred in finding that the 
representative of appellant had access to or ex- 


Bastch Brothers Construction Co. 219 


amined appellee’s payrolls and books during the 
period payments were being made to or for the 
account of the subcontractor. 


20. The trial court erred in finding that appel- 
lant is estopped from asserting the failure of ap- 
pellee to perform the conditions precedent con- 
tained in the bond. 


26. The trial court erred in finding that the con- 
duct of appellant lulled appellee into a feeling of 
security. 

27. The trial court erred in finding that the 
complaint states a claim upon which relief can be 
granted. 


28. The trial court erred in finding that the 
evidence establishes a claim upon which relief can 
be granted. 


29. The trial court erred in finding that the 
bond, by the terms thereof, bound appellant for the 
faithful performance of the work to be done 
under the terms of the subcontract, Plaintiff’s Ex- 
Hamtont, ©97”, 

30. ‘The trial court erred in finding that the 
provisions of the subcontract constitute obligations 
of appellant. 

ol. ‘The trial court erred in finding that it was 
the intention of the parties that the provisions of 
the subcontract were obligations of appellant. [505] 


302. The trial court erred in finding that the sub- 
contractor certified to weekly payrolls paid by ap- 
pellee. 


220 Glens Falls Indemnity Co. vs. 


33. The trial court erred in finding that all of 
the items set forth in the bill of particulars as 
amended and corrected, were used in the perform- 
ance of the subcontract. 

34. The trial court erred in finding that the 
amounts set forth in the bill of particulars as 
amended and corrected, were reasonable and fair. 

30. ‘The trial court erred in finding that the 
amounts set forth in the bill of particulars as 
amended and corrected, represents the actual cost 
to appellee of completing the subcontract work 
after June 8, 1945. 

36. The trial court erred in finding that appel- 
lant was indebted to appellee on June 8, 1945. 

37. The trial court erred in finding that appel- 
lant is indebted to appellee for money expended 
after June 8, 1945, on account of any default on the 
part of the subcontractor. 

38. The trial conrt erred in finding that appel- 
lant is indebted to appellee for interest prior to 
date of judgment. 

39. The trial court erred in concluding that 
appellee is entitled to judgment against appellant. 

40. The trial court erred in concluding that 
appellee is entitled to judgment against appellant 
for interest. 

41. ‘The evidence does not support or sustain the 
findings of fact and conclusions of law as aforesaid. 

42. The trial court erred in decreeing that ap- 
pellee is entitled to Judgment against appellant. 


Basich Brothers Construction Co. 221 


43. The trial court erred in decreeing that ap- 
pellee is entitled to judgment against appellant for 
interest. 

44, The trial court erred in permitting witness 
George J. Popovich to testify from a summary of 
purported documents not in court and available to 
counsel for cross-examination. [506] 

45. The trial court erred in permitting witness 
George J. Popovich to testify from a summary of 
purported documents not shown to be admissible in 
evidence. 

JOHN E. McCALL, 
Attorney for Appellant and Defendant Glens Falls 
Indemnity Company, a Corporation. 


Service of a copy of the foregoing Statement of 
Points on Which Appellant Intends to Rely ac- 
knowledged this 15th day of May, 1947. 


STEPHEN MONTELEONE, 
Attorneys for Plaintiff and 
Appellee. 


[Endorsed]: Filed May 16, 1947. [507] 


[Title of District Court and Cause. ] 


STIPULATION AND ORDER 
It Is Hereby Stipulated by and between the 
plaintiff and appellee Basich Brothers Construction 
Company, a corporation, and defendant and appel- 
lant Glens Falls Indemnity Company, a corpora- 
tion, in the above-entitled action, by and through 
their respective attorneys of record, that the origi- 


222 Glens Falls Indemnity Co. vs. 


nal exhibits in the above-entitled [508] action may 
be transmitted to the Circuit Court of Appeals for 
the Ninth Circuit for use in printing the reeord on 
appeal, in lieu of copies. 


Dated this 8th day of May, 1947. 


STEPHEN MONTELEONE, 
Attorney for Plaintiff and 
Appellee. 


JOHN E. McCALL, 
Attorney for Appellant and Defendant Glens Falls 
Indemnity Company, a Corporation. 
It is so ordered this 15th day of May, 1947. 


PAUL J. McCORMICK 
U. 8. District Judge. 


[Endorsed]: Filed May 16, 1947. [509] 


[Title of District Court and Cause. ] 


CERTIFICATE OF CLERK 


I, Edmund L. Smith, Clerk of the District Court 
of the United States for the Southern District of 
California, do hereby certify that the foregoing 
pages numbered from 1 to 516 contain full, true, 
and correct copies of Complaint for Recovery of 
Money and on Bond; Bill of Particulars; Notice 
to Produce; Request for Admission Under Rule 36; 
Stipulation filed Sept. 9, 1946; First Amended 
Answer of Defendant Glens Falls Indemnity Com- 
pany; Amendments to Bill*of Particulars; Stipula- 
tion (unsigned by counsel for plaintiff) filed Octo- 


Basich Brothers Construction Co. 223 


ber 14, 1946; Copy of Letter dated October 8, 1946, 
to Mr. Stephen Monteleone from J. E. McCall; 
Memorandum filed October 14, 1946; Amendments 
to Plaintiff’s Complaint; Answer of Defendant 
Glens Falls Indemnity Company to Plaintiff’s 
Complaint as Amended; Memorandum of Defend- 
ant Glens Falls Indemnity Company re Plaintiff’s 
Bill of Particulars; Decision and Order for Judge- 
ment and Findings; Findings of Fact and Conelu- 
sions of Law; Judgment; Notice of Appeal; State- 
ment of Points on Which Appellant Intends to 
Rely ; Stipulation and Order re Exhibits and Desig- 
nation of Record which, together with copy of re- 
porter’s transeripts of hearings on July 8, 1946, 
October 14, 1946, November 7, 1946, November 25, 
1946, February 4, 1947, and February 5, 1947, and 
Original Plaintiff’s Exhibits 1 to 24, inclusive, and 
Original Defendant’s Exhibits A to D, inclusive, 
transmitted herewith, constitute the transcript of 
record on appeal to the United States Circuit Court 
of Appeals for the Ninth Circuit. 

T further certify that my fees for preparing, com- 
paring, correcting and certifying the foregoing 
record amount to $74.50 which sum has been paid 
to me by appellant. | 

Witness my hand and the seal of said District 
Court this 13th day of June, A.D. 1947. 


[Seal] EDMUND L. SMITH, 
Clerk. 


By THEODORE HOCKEH, 
Chief Deputy Clerk. 


224 Glens Falls Indemnity Co. vs. 
In the District Court of the United States in and 


for the Southern District of California, Cen- 
tral Division 
Honorable Peirson M. Hall, Judge Presiding. 
No. 5021-PH Civil 


BASICH BROTHERS CONSTRUCTION COM- 
PANY, a Corporation, 
Plaintiff, 


VS. 


GLENS FALLS INDEMNITY COMPANY, a 
Corporation, and ANDREW DUQUE and 
CARSON FRAZZINI, co-partners doing busi- 
ness under the name of DUQUE & FRAZZINI, 

Defendants. 


REPORTER Ss TRANSCRTET On 
PRETRIAL HEARING 


Appearances : 


For the Plaintiff Stephen Monteleone, Esq., 1049 
Petroleum Building, Los Angeles 15, California. 

For the Defendant Glens Falls Indemnity Com- 
pany: John EH. McCall, Esq., 458 South Spring 
Street, Los Angeles 13, California. 


Basich Brothers Construction Co. 225 


Los Angeles, California, July 8, 1946 
2:50 o’Clock p.m. 


(In chambers. ) 

The Court: Very well. I have your statement 
of issues involved. I do not know what more can 
be settled by a pre-trial conference here. What 
do you think? 

Mr. Monteleone: I don’t know what can be 
settled. The facts are very simple, as a matter of 
Teele 

The Court: Have you exchanged all your ex- 
hibits? 

Mr. Monteleone: We have. As a matter of fact, 
we are both using the same exhibits. Practically 
every one of Mr. McCall’s exhibits are the ones 
that I presented to the Court. 

Mr. McCall: No, we never did get those con- 
tracts, your Honor. That is one thing that I wanted 
to bring up here. We gave notice, the file will 
show, to produce. If your Honor has the bill of 
particulars there you will notice, on Schedule 6, the 
last part, page 2, it says: ‘‘ Insurance includes com- 
pensation, public lability, property damage, Cali- 
fornia unemployment, Federal old age and Federal 
excise.’’ Those are the documents we have asked 
for the production of. 

When we came up here the last time counsel for 
the plaintiff suggested that in lieu of bringing those 
documents here that he would stipulate that they 
were all carried in the name of the plaintiff as the 


226 Glens Falls Indemnity Co. vs. 


employer of these men instead of being carried as 
the subcontractor’s employees. When we got up 
here the other day I had drawn up a proposed 
stipulation which counsel for the plaintiff suggested 
that he take back and show to his client, the plain- 
tiff. He took it back and he showed it evidently 
and then he refused to sign it. 


Mr. Monteleone: No. Let me correct that, Mr. 
McCall. 


I explained to your associate, when he came to 
the office, that I would stipulate that all of those 
documents were carried in the name of Basich 
Brothers Construction Company as the employers. 
I asked counsel to add to that stipulation a quali- 
fication that by so stipulating we do not concede 
that Basich Brothers were, in fact or in law, the 
actual employers. 


in other words, they were carried as a matter 
of convenience to save the expense of the sub- 
contractor. That is a customary practice among 
contractors, to carry their subcontractor’s em- 
ployees under their workmen’s compensation. 


I am willing to stipulate, and I so stipulate now, 
that all of those records designated in the stipula- 
tion prepared by Mr. McCall indicate Basich 
Brothers as the employers. However, we want the 
privilege of explaining to the Court during the 
trial how it happened that Basich Brothers appears 
as. the employers. 


Bastch Brothers Construction Co. 22 


The Court: Do you have the contracts? 

Mi. Monteleone: Yes, I have the contract. ‘The 
contract gives Basich Brothers the right to do that. 

The Court: What you are asking for is the 
contract, isn’t that so? | 

Mr. McCall: That is right. 

Mr. Monteleone: You have the contract. 

Mr. McCall: The contracts of insurance? 

The Court: Yes. 

Mr. McCall: Compensation, and so forth. That 
is what we wanted produced so that we can intro- 
duce it here in evidence. 

Mr. Monteleone: It will be produced. I didn’t 
know that. I thought you merely wanted—I will 
stipulate that Basich Brothers appears as the em- 
ployers in connection with these documents. I will 
so stipulate now. 

Mr. McCall: But there are other matters that 
counsel wants to put in there which is matters of 
defense only, and if we are going to go into that 
stipulation we would be setting aside all the case 
that we have in connection with that particular 
point. 

The Court: What I understand is that counsel 
is willing to stipulate that the documents read as 
they read. 

Mr. Monteleone: That is correct. 


The Court: Without waiving any right to any 
defense he might have. 


228 Glens Falls Indemnity Co. vs. 


Mr. Monteleone: That is correct, if your Honor 
please. 


Mr. McCall: That is okay. He doesn’t need 
that, of course. Anyone knows that he would not 
be waiving any right. 

Now I have changed that and wrote in here in 
this shape a request for admission under Rule 36. 
While counsel is looking that over, that is the same 
thing exactly except it is just an admission and I 
don’t know how other lawyers would handle it, but 
I do get the State court and Federal court mixed 
up if I do not follow the rule on that particular 
matter. 


So if counsel would just acknowledge receipt of 
the original, I will file it, and then you can have all 
the time you want to put in your answer, because 
it has to be filed later on. 


Mr. Monteleone: In other words, we can’t 
change the wording of the documents. I do not 
know if your Honor has read the subcontract or not. 


The Court: No, I haven’t. I do not read these 
things until I have to. 


Mr. Monteleone: It provides that is the sub- 
contractor does not provide workmen’s compensa- 
tion, public lability, and so forth, then the general 
contractor has the right to do so and charge the 
premium against the subcontractor. When the 
subeontractor failed to procure workmen’s com- 
pensation, public hability and property damage in- 
surance, under the subcontract, which is a part of | 


Basich Brothers Construction Co. 229 


the bond of the defendant, we paid for those differ- 
ent policies and we are charging the subcontractor 
with the same money under that provision of the 
contract. 

The Court: Do you want to acknowledge receipt 
of that? 

Mr. McCall: I would like to say one thing on 
that, since counsel has that point before the Court. 
He is absolutely correct about what the contract 
says, that if the subcontractor does not pay these 
items the general contractor can do it and charge 
it to him and take it out of any monev he may owe 
him. But in this case all the evidence shows that 
these documents we are asking for that the general 
contractor was the subcontractor, the general con- 
tractor and everything. He carried all the insur- 
ance, all the compensation, paid the compensation, 
and all that. 

The Court: That is what your position is? 

Mr. McCall: That is right. 

The Court: All right. Then those documents 
will be produced ? 

Mr. Monteleone: They will be produced in court. 

The Court: Will you need them in advance? 

Mr. McCall: We certainly do need them in ad- 
vance to prepare our case. 

Mr. Monteleone: All right. 

Mr. McCall: If we can get this information 
back that we have asked for 

Mr. Monteleone: If you want to save time and 
not encumber the record, I will stipulate that what 
you set forth in your request for admissions is true. 


230 Glens Falls Indemnity Co. vs. 


We admit those. But we want the privilege of 
explaining it in court. 

The Court: Reserving your defense ? 

Mr. Monteleone: That is correct. 

Mr. McCall: That is right. 

The Court: You still want to look at the docu- 
ments, do you? 

Mr. McCall: We would hke to look at the docu- 
ments but we don’t have to have them now, or in 
any big hurry. 

The Court: When do you have to have them. 
This case has not been set for trial. 

Mr. McCall: No, it hasn’t. 

Mr. Monteleone: May we go to trial on the 16th 
of July? 

The Court: I am afraid we cannot do that now 
because next Monday, the 15th, I have a three-judge 
ease set. I do not know how long it is going to take. 
The parties want to take oral testimony. 

Mr. Monteleone: We have this situation: There 
are a great many cases pending in Arizona involvy- 
ing this same bond, the same subcontract, in which 
the defendant Glens Falls has been named on a 
third-party complaint, and we were trying to avoid 
going to Arizona. We made three trips there al- 
ready and it is pretty tiring and is quite an expen- 
sive proposition. It involves the same issues as 1s 
presented in this case here. Now we can’t stall 
those Arizona cases. 

The Court: Are they in Federal Court? 

Mr. Monteleone: They are in Federal Court. 

The Court: In Judge Ling’s court? 

Mr. Monteleone: Some are in Judge Ling’s 
court and some are in Tucson. 


Basich Brothers Construction Co. 230 


The Court: Judge Ling is here. I thought 
maybe you could transfer this case to him here, but 
I do not know whether he can take it or not. 

Mr. McCall: We are offering to do anything, 
just to get this case over, except to pay the $100,000. 

Mr. Monteleone: Why object to going to trial 
on the 16th of July before Judge Hall then? 

The Court: I cannot try it on the 16th. I can- 
not give you any assurance that I can. I might be 
able to try it. J do not know what will happen on 
the three-judge hearing. 

Mr. Monteleone: We will go to any court to 
have this matter determined. 

The Court: Judge Ling is the other District 
Judge designated with me on this hearing, so he 
will be tied up on that. 

Mr. Monteleone: Suppose we hold it open and 
come up here on the 16th? 

The Court: You do not have many witnesses? 

Mr. Monteleone: No. 

Mr. McCall: That is another point, your Honor. 
We have had a lot of uphill sledding. The notice 
sent out by your Honor called for the names and 
addresses of witnesses and they didn’t put in any 
of the addresses of their witnesses, and we can’t 
find them to take their depositions, and we want 
some of those depositions. 

Mr. Monteleone: What depositions do you want? 
You have Mi. Basich’s deposition. He is the only 
one. The others are nothing but bookkeepers and 
accountants who prepared the bill of particulars, 
aside from Mr. Kovich. Mr. Kovich was Mr. 


232 Glens Falls Indemnity Co. vs. 


Basich’s superintendent, and all he knows is what 
Basich knew, and you have Basich’s deposition. 
You took half a day in taking his deposition. 

Mr. McCall: Some of the information Mr. 
Basich gave us makes us know that we must have 
Mr. Kovich’s deposition, and Mr. Popovich’s. 

Ts it My. Popovich that drew the subcontract? 

Mr. Monteleone: No, My. Popovich is the book- 
keeper. 

Mr. McCall: Who drew up the subcontract? 

Mr. Monteleone: I don’t know. 

Mr. MeCall: That is what Basich said. 

The Court: How are you going to take their 
depositions before next Tuesday if you should go 
to trial next "Tuesday ? 

Mr. McCall: We couldn’t do it, your Honor. If 
we go to trial next Tuesday it would take three 
weeks to take testimony on this bill of particulars. 
In other words, if we have a little time we can work 
this out together and we can save a week or two. 
The case should not take over three or four days 
to try. 

Mr. Monteleone: We went to Tucson to try the 
issues Involved in this matter, we dragged out wit- 
nesses up there, and Mr. McCall went there and 
they raised some technical objection when we were 
about to go to trial, after we were in Tucson to try 
these various issues. This was about four or five 
months ago. ‘The same issues were raised under 
third-party complaints filed in these actions, and 
we were before Judge Sames, who was to hear the 
matter before he retired. We went three days there 


Basich Brothers Construction Co. oe, 


and then these objections were made. They were 
nothing more nor less than mere technical objec- 
tions, but Judge Sames sustained the objection with 
the privilege of amending by interlineation, but 
they were not ready to go to trial] because they raised 
the objection. It has been nearly a year and a half 
that we have been battling with the insurance com- 
pany over these claims here. Mr. McCall can’t say 
that he is unprepared. 

The Court: He doesn’t say he is unprepared, but 
he says it will save a lot of the Court’s time to take 
depositions. 

Mr. Monteleone: What depositions? There are 
no depositions, your Honor please, except the man 
who is Basich Brothers’ superintendent on the job, 
and he is going to be a witness here. He is called 
as a witness and he will testify. 

Mr. McCall: Counsel just drove me into making 
this statement. He says on account of technical 
objections I raised over there we said we weren’t 
ready for trial. We tried that case. Judgment 
went against his client. 

Mr. Monteleone: Not on the third-party com- 
plaint. 

Mr. McCall: I am only defending on the third- 
party complaint and the Court held that the third- 
party complaint failed to state a cause of action, 
and on motion of the plaintiff’s attorney he granted 
them leave to amend, and they did amend. I don’t 
think that is a technical objection. We tried the 
case already. 

‘The Court: That is beside the issue here. 


234 Glens Falls Indemnity Co. vs. 


Mr. Monteleone: There is no deposition that he 
has in mind except Mr. Kovich, who will be a wit- 
ness and will testify at the trial. He was the super- 
intendent of Basich Brothers on the job. We are 
anxious to have this matter determined because it 
involves so many other matters. 

Mr. McCall: I would like to illustrate, if [ 
might, one point which shows the fact that we are 
not prepared, that is, we do not have our ease pre- 
pared, to save the time of the Court and counsel 
and expenses and that I have diligently sought for 
information. 

On the 7th of June a letter was addressed to the 
plaintiff and his attorney in which I asked this 
question : 

‘The third paragraph of your letter of May 
23rd, 1945, states that said subcontractors did 
not commence work within the time specified 
in said contract, but you did not state when the 
subcontractors did commence work on said con- 
tract. We would like to have this information, 
together with any and all other information 
you may be able to give us concerning matters 
which in your opinion amount to a default on 
the part of said subcontractors. The subcon- 
tractors deny that they are in default in any 
way whatever.”’ 


On the llth of June I received this statement 
from the attorney for the plaintiff: 


‘“* * * For the information of vourself and 
your client we have no direct knowledge when 


Bastch Brothers Construction Co. 230 


the work commenced but that Basich Brothers 
had no reason to believe that Duque & Frazzini 
had not sufficient workmen and equipment to, 
insure the completion of said work as the con- 
tract provided until the early part of April 
1945.” 


Now in taking the deposition—I just bring that 
out as one illustration—in taking that deposition 
all that came out clear. Mr. Basich said just ex- 
actly when they started work. That is, all the 
information that I couldn’t get there I got from him. 

We were talking about these insurance policies. 
Here are thousands and thousands of dollars paid 
for insurance. We do not know the insurance com- 
pany. We have no way of finding that out. 

The Court: When ean you have those available? 

Mr. Monteleone: I will have those available to- 
morrow. 

The Court: All right. 

Mr. McCall: Fine. That helps us then. 

The Court: On your request, the plaintiff will 
be ordered— 

My. Monteleone: You are talking about work- 
men’s compensation ? 

Mr. McCall: All the insurance policies. 

The Court: They will be made available for 
counsel’s inspection at your office tomorrow ? 

Mr. Monteleone: Yes. 

Mr. McCall: That is fine. 

My. Monteleone: Your Honor will find a letter 
written to the defendant over a year ago in which 
they were given the privilege of examining all the 


236 Glens Falls Indemnity Co. vs. 


letters at the office of Basich Brothers regardless. 
That offer was never accepted by them. 

The Court: Youn say you want to take deposi- 
tions ? 

Mr. McCall: I would like to take some of those 
depositions, yes, sir, and one leads to another. I 
know I want to take the deposition of George 
Kovich. He was the general superintendent on the 
job from start to finish. I do not know his present 
address, however. 

The Court: Will you stipulate to his deposition ? 

Mr. Monteleone: I will stipulate to it. 

The Court: When? 

Mr. Monteleone: He is in Fresno, and we will 
have to reach him. We will have him here this 
week. 

The Court: During the week? 

Mr. McCall: Any time that I am not in trial. 
Mr. Monteleone: How about Friday ? 

Mr. McCall: Friday the 12th? 

Myr. Monteleone: Yes. 

Mr. McCall: 2:00 o’clock ? 

Mr. Monteleone: 2:00 o’clock. 

Mr. McCall: Of course you will have to find out 
if you ean reach him. 

Mr. Monteleone: We will make the effort to 
get him. 

The Court: All right. That is stipulated to. 
Deposition at 2:00 o’clock Friday of this week, 
July 12th. 

What other depositions do you want to take? 

Mr. McCall: I called Carson Frazzini. He is 


Bastch Brothers Construction Co. 28% 


the subcontractor. We have no assistance from 
anybody. We just have to gouge out the informa- 
tion as best we can. 

Mr. Monteleone: We have no assistance either, 
Mr. McCall. 

Mr. McCall: So I finally got Mr. Carson Fraz- 
zini today in Reno, and he said that he would give 
us his deposition if we would come to Reno to take 
it, and Mr. Monteleone has already stated that he 
will send Mr. Goodman or someone else there to 
take that deposition in his behalf. 

Mr. Monteleone: I will arrange for somebody 
to take it. 

The Court: What other depositions do you want? 

Mr. McCall: You have the names there. 

The Court: Nick L. Basich, Harold Slonaker, 
Bart Woolums, Paul Albino, Homer Maitcheil, 
George Kovich, George Popovich, Homer S%. 
Thompson. 

Mr. McCall: Popovich, I want to take his depo- 
sition, I am quite sure, but I will not know for suve 
until [ finish with Mr. Kovich. 

Mr. Monteleone: For your information, Mr. 
McCall, Popovich is the office manager. Probably 
you want to know who prepared this subcontract. 

Mr. McCall: Yes. 

Mr. Monteleone: He undoubtedly prepared the 
subcontract from a regular form as a elerk does, if 
your Honor please, and from Basich’s testimony 
we will stipulate that the contract was drafted, that 
is, the mechanical part was drafted, by Mr. Popo- 
vich. 


238 Glens Falls Indemnity Co. vs. 


The Court: Do you still want his deposition? 

Mr. McCall: J am not sure, your Honor. 

Mr. Monteleone: That is a fact. I have already 
talked to him. 

Mr. McCall: Those depositions I would not let 
hold up my case though. 

The Court: Obviously I cannot give you any © 
definite trial date for next week. J am set up now 
until the last week in September, September 24th. 

Mr. Monteleone: ‘That will be fine. 

Mr. McCall: September 24th suits me fine, ex- 
cept that I have to be at the State Bar then. I 
have all of my dates set down through Saturday. 

The Court: Then you won’t be there? 

My. MeCall: Hardly. 

The Court: I will set it for trial on that date, 
and if you have any depositions that you want to 
get out of the way, get them out of the way or else 
by notice sufficient In advance during this month 
because I will not be here in August. 

Mr. McCall: We ean stipulate as to all depo- 
sitions. 

The Court: Very well. 

Are these issues sufficiently framed here so that 
there isn’t any quarrel about them? I notice you 
are complaining about the default. Has that been 
specified sufficiently to put the matter in issue? 

Mr. McCall: It was my impression that it had. 
Now the rule is to the effect that the plaintiff may 
allege generally, but the answer must state spe- 
cifically. I have several special defenses there and 
I take it that the special defenses are a part of the 
answer, is that not true? 


Basich Brothers Construction Co. 239 


The Court: Yes, that is correct. 

Mr. McCall: In other words, because I don’t put 
it in my answer, if I have it in my special defenses, 
that is all right. 

The Court: That is part of the answer, but what 
I was getting at is the matter of an issue when I 
come to decide it here. The first thing is whether 
or not there is a default. 

Mr. McCall: That is right. 

The Court: And the second thing is when it 
occurred and what it was. 

Mr. McCall: And did they give notice of it. 

Mr. Monteleone: Here is a question. I don’t 
know whether it is a matter of pleading or not. 
Where the default is raised in the answer can we 
introduce evidence on it. We don’t contend that 
there was any default but in the event that there 
was we contend that the insurance company waived 
any requirement of notice because they contend that 
the default took place. [hey were notified on 
April 5th. 

The Court: Do you contend that there was a 
default ? 

Mr. Monteleone: No, there wasn’t. We don’t 
concede that there was, but I say that in the 
event 

The Court: How are they lable if there is no 
default ? 

Mr. Monteleone: How is who liable? 

The Court: How is the defendant bonding com- 
pany liable 1f there was no default? 


240 Glens Falls Indemnity Co. vs. 


Mr. Monteleone: There was a default later on. 
I mean, what the bonding company claims is when 
the default took place we had not notified them and 
the sub-contractor contmued with the work until 
June. 

The Conrt: At which time there was a default? 

Mr. Monteleone: Not only a default but an aband- 
onment of the work. 

The Court: That is the default upon which you 
rely? 

Mr. Monteleone: That is the default; yes. 

The Court: In answer to their question that there 
was no notice, you claim that they already knew 
about it? 

Mr. Monteleone: We claim that they already 
knew about it, but they recognized the policy and 
they permitted us to continue with the understand- 
ing that this bond was still a faithful performance 
bond. 

The Court: I just wanted to know if the issue 
was framed as between the parties. 

Mr. McCall: On whose understanding was it that 
this bond was faithful performance for anything? 
Whose understanding did you have at that time? 
We did not know until just then, your Honor, when 
they claim that there was a default. That is what 
we have been trying to find out. Now as I under- 
stand it, counsel for the plaintiff says they are 
not claiming that there was any default until the 
abandonment of the job, which was on or about 
June 8, 1945. Is that correct? 


Basich Brothers Construction Co. 241 


Mr. Monteleone: The default on the pait of the 
subcontractor ? 

Mr. McCall: Yes. 

Mr. Monteleone: Yes. We have been trying to 
work out with the bonding company to put in addi- 
tional equipment to produce sufficient material, at 
lease where the Government was ready to step in 
and take the whole job away from the prime con- 
tractor. Your Honor hasn’t read these letters and 
the information given in them so that you are not 
familiar with what transpired for a matter of 
months before the subcontractor abandoned the 
work. As a matter of fact, the bonding company 
representative and Basich Brothers made—how 
many trips?—three trips to Arizona in the mean- 
while. 

Mr. McCall: I think you and I went with them 
every time they went over there. 

Mr. Monteleone: No, we didn’t. 

TI don’t know whether your Honor understands it 
or not, but we are not suing for damages which re- 
sulted by reason of any delay in the operation. We 
are not asking that at all. That is what was in- 
volved in that Lang Transportation Company ease. 
We are not asking for damages. We are delayed 
and we could have made a claim for damages. But 
all we are asking for is the money which was ac- 
tually paid by Basich Brothers to eover the payroll 
and equipment and material which was acquired by 
the subcontractor in performing their subcontract 
over and above the amount that was earned by the 


244 Glens Falls Indemnity Co. vs. 


I was under the impression that you gentlemen 
would agree either as to the many items in the bill 
of particulars as to each one or as to each class. 
I understand that they can be divided into classes 
at least concerning dates of demand or dates of 
payment. 

Mr. McCall: On that point, may it please the 
Court, we still have a few exhibits that we would 
like to hand in, and on the points of the items in 
the bill of particulars I have written a letter to 
plaintiff’s counsel 

The Court: Have you stipulated or not? 

Mr. McCall: No, we have not. 

The Court: The matter is off calendar. 

Mr. Monteleone: If the Court please, I will 
concede everything that Mr. McCall has raised. 

The Court: J think the great difficulty here is 
to know just what Mr. MeCall is raising. 

Mr. Monteleone: I don’t know. I have agreed 
to whatever he has agreed to, and I will stipulate 
that he may introduce the exhibits he called to my 
attention. 

The Court: Let us reduce the stipulation to 
writing. 


Mr. Monteleone: I am willing to agree to any 
of these items. 

The Court: The matter is off calendar. You 
gentlemen get some stipulation in writing as to 
those various amounts. 

Mr. Monteleone: It is not due to the fault of 
plaintiff, and we should not be penalized in con- 
nection with the matter. 


Bastch Brothers Construction Co. 245) 


The Court: J could not try the case anyway, 
Mr. Monteleone. 

Mr. Monteleone: I understand that, if the Court 
please, but it is apparent that it has been the pur- 
pose of ihe defendant to stall this matter as long 
as possible because we are in a very serious sitwa- 
tion now, confronted with a great many litigations 
pending, and apparently the defendant assumes 
that the plaintiff may have to make certain con- 
cessions that he otherwise would not if we go to 
trial. There are just a few little items involving 
less than $50 or $60, that we are willing to discount 
and throw off from the bill of particulars. The 
exhibits that Mr. McCall desires to introduce in 
evidence I will stipulate they may be introduced 
in evidence. 

Mr. McCall: May we introduce those at this 
time, your Honor ? 

Mr. Monteleone: I have no objection to that. 

The Court: I guess you can. 

Mr. McCall: The first exhibit on the part of 
the defendant here is a contract dated May 3rd. 


Mr. Monteleone: You mean a letter. 

Mr. McCall: It is a letter. 

The Court: A writing. Let us say it is a writing, 
then nobody will be committed as to whether it is 
a letter of contract or an agreement. 

Mr. McCall: As I eall these off shall I hand 
them to the Clerk? 

Have you seen them, Mr. Monteleone? 


246 Glens Falls Indemmty Co. vs. 


Mr. Monteleone: Yes, I have seen them. Are 
they the ones you refer to in the deposition? 

Mr. McCall: Yes. 

Mr. Monteleone: No objection. 

Mr. McCall: Here is one dated May Ist. 

Mr. Monteleone: No objection. 

Mr. McCall: Then Mr. Monteleone has the recap 
of the estimates which we would like to put in as 
a defendant’s exhibit. 

Mr. Monteleone: No objection. 


Mr. McCall: Then the statement of money paid 
prior to March 7, 1945, a copy of which was left 
in counsel’s office. 

Mr. Monteleone: No objection. 

Mr. McCall: And the note and letter to the at- 
torney, and the transcript before Judge Harrison. 
That is already in. 

The Court: Do you offer that in evidence in 
this court? 

Mr. McCall: I just want it before the court. 

The Court: Do you offer it in evidence? 

Mr. Monteleone: We will offer it on behalf of 
the plaintiff. 

The Court: All right. It is in evidence. 

What about the exhibits you offered there and 
withdrew? Do you re-offer them? 

Mr. McCall: I did not withdraw these, your 
Honor. 

The Court: They were withdrawn, according to 
the transcript. 

Mr. Monteleone: We will offer them on behalf 


Basich Brothers Construction Co. 247 


of the plaintiff, the same as indicated in the tran- 
script. 

The Court: You re-offer them? 

Mr. Monteleone: Yes, your Honor. 

Mr. McCall: Yes, your Honor. I thought they 
had already been offered. 

The Court: These are admitted in evidence to 
be serially numbered. 


(The documents referred to were received in 
evidence and marked Plaintiff’s Exhibits 1 to 
19 inclusive respectively. ) 

[ Plaintiff’s Exhibits are set out in full fol- 
lowing Reporter’s Transcript—See Index for 
Page Number. ] 

Mr. McCall: Then we have a stipulation here 
regarding the insurance policies which is already 
in evidence but for some reason the stipulation was 
not left with the reporter. 

The Court: File it with the Clerk. 

Mr. Monteleone: I think that we agreed at the 
pretrial to all of these matters, if the Court please. 

The Court: File it with the Clerk. 


(The document referred to was received in 
evidence and marked Defendant’s Exhibits A, 
B, C and D.) 

[Defendant’s Exhibits A, B, C, D, are set out 
in full following Reporter’s Transcript—See 
Index for Page Number.] 

Mr. McCall: Then there were certain insurance 
policies mentioned in here. This Court at a pre- 
trial hearing made an order in chambers that the 


248 | Glens Falls Indemnity Co. vs. 


policies be exhibited to me as counsel for the de- 
fendant on the next day. 

The Court: Are they in evidence? 

Mr. McCall: No, they are not. They have never 
been exhibited to me. I sent my auditor out to look 
at them, they were to be shown to him, and he asked 
defendant’s counsel, according to his report to me, 
several times but those policies have never yet been 
exhibited to the defendants. 

Mr. Monteleone: Mr. McCall had an auditor 
spend about three weeks at the office of the plaintiff 
at Alhambra, if the Court please. These documents 
were all exhibited to the auditor, and it merely 
refers to the matters contained—— 

The Court: Mr. Monteleone, are the insurance 
policies material in this case? 

Mr. Monteleone: Not at all. 

The Court: Do you maintain that they are 
material ? 

Mr. McCall: Yes. 

The Court: Do you now make a demand on the 
other side to produce these policies? 

Mr. McCall: Yes, I do. 

The Court: Do you want the policies? 

Mr. McCall: Yes, your Honor. 

Mr. Monteleone: They will be offered. 

The Court: Do you want to offer them in evi- 
dence ? 

Mr. McCall: Yes. 

Mr. Monteleone: They will be produced and 
offered in evidence, if the Court please. 

Mr. McCall: Your Honor, the plaintiff’s com- 


Basich Brothers Construction Co. 249 


plaint refers to the prime contract between Basich 
Brothers Construction Company and the United 
States Government and it alleges that it is not 
attached to the complaint because it was too bulky. 
I would like for the plaintiff to bring in that part 
of the contract. 

The Court: Why cannot he bring it all in? 

Mr. Monteleone: If the Court please, Mr. Mc- 
Call had that in his office last week and he made 
a copy of whatever portion he desired. It is the 
only one we have and I would like to keep it. 

The Court: How am I to know what is in it? 

Mr. Monteleone: We will have it introduced as 
an exhibit. 

The Court: That will be plaintiff’s next exhibit 
in order when it gets here. 

Mr. Monteleone: All right. 

Mr. McCall: We have requested the Govern- 
ment for a form and to accommodate counsel we 
will fill that in and stipulate that that is a copy of 
the part that we want to put in. 

The Court: Form of what? 

Mr. McCall: We have ordered it from the 
Government. 

The Court: He is going to introduce the prime 
contract in evidence and produce it in court here. 

Mr. McCall: He only has the one copy he says, 
your Honor, and if he needs it I don’t want to 
work a hardship on him. 

Mr. Monteleone: If we have to eall on the 
Court for assistance to make a copy, we can do 
that later. 


250 Glens Falls Indemnity Co. vs. 


The Court: He will produce it and if you want 
to withdraw it you can put the forms in, or any- 
thing else that you like. But I will not know what 
is in the contract until I see it. 

Mr. Monteleone: That will be introduced in 
evidence. 

Mr. McCall: Now, your Honor, I am bound to 
answer plaintiff’s charges that I have not cooper- 
ated in connection with the items in the bill of 
particulars. On October 8th I wrote him a letter 
in which I pointed out the reason we were not able 
to stipulate to items in there. Now may I hand 
this in as an exhibit for the defendant? 

The Court: Are you offering that in evidence? 

Mr. McCall: Yes, your Honor. 

The Court: Do you have any objection? 

Mr. Monteleone: No, if the Court please, except 
I want to explain these various items for the record. 

The Court: Are you offering this letter as an 
exhibit or are you filing it as argument? I did not 
know lawyers could make evidence as they went 
along by writing a letter to the other lawyer after 
the suit had started. 

Mr. McCall: It may be argument. 

The Court: It will be filed in the records of the 
ease but not as an exhibit. 

Mr. Monteleone: May this document be filed 
as an answering explanation of those items? 

The Court: It may be filed. 

Mr. McCall: Ido not have a copy of his answer. 

:The Court: You can copy it from the Clerk. 

Mr. McCall: The reason of that, vour- Honor, 


Basich Brothers Construction Co. 25 


is that it will show the Court the way the bill of 
particulars is built up and that the items are such 
that counsel cannot possibly stipulate to them. I 
see no way that they can be determined except by 
trial, either before the Court or before a master. 

The Court: Item by item? 

Mr. McCall: Well, we have no proof of the 
items, your Honor. There was millions of dollars 
spent at this place. 

The Court: Do either of you have any further 
exhibits or evidence to offer in the case at this 
time ? 

Mr. Monteleone: We have none, if the Court 
please. 

Mr. McCall: None. 

The Court: The matter will stand submitted, 
with this proviso, that upon examination of the 
files and records, when I get to it I may restore 
it to the calendar for some testimony. 

Mr. McCall: It is understood that this evidence 
heretofore submitted by counsel for the plaintiff 
and the defendant is on the question of lability 
only, is that right? 

The Court: JI do not know what it is on. I did 
not hear it. 

Mr. McCall: It was stipulated between counsel 
before that we would submit this evidence and then 
it would be submitted on briefs, and that was the 
original idea. 

The Court: Have you filed your briefs? 

Mr. Monteleone: I have, if the Court please. 

Mr. McCall: JI have not filed a brief, and his 


252 Glens Falls Indemnity Co. vs. 


brief is not designated as an opening brief. It is 
only designated as points and authorities, and I do 
not think it does his case justice, and I don’t want 
to take the advantage of him. If he wants to de- 
nominate that as his opening brief, I shall certainly 
be glad to file a reply to it. 

Mr. Monteleone: I will stand on what I file, if 
the Court please. 

The Court: You do not desire to file any fur- 
ther briefs ? 

Mr. Monteleone: No, I am satisfied with the 
brief I have already filed. 

Mr. McCall: Then may I file a reply brief? 

The Court: How long will you want for your 
reply brief? 

Mr. McCall: I would like to have 30 days. 

The Court: I thought you were in a hurry to 
get this ease decided. You can write a brief in 10 
days. 

Mr. McCall: I think I ean. 

The Court: You will have 10 days to file a reply 
brief and the plaintiff will have 5 days thereafter 
to reply. 

Mr. Monteleone: That is sufficient. 

The Cowt: Then after 15 days the matter will 
stand submitted. 

Mr. McCall: On the question of liability ? 

The Court: I haven’t seen it. Whatever you 
have here will be examined. 

I want to suggest this, however, that if it is at 
all possible to try this lawsuit all at onee, it is my 


Basich Brothers Construction Co. 258 


purpose and intention that it shall be tried rather 
than to determine a portion of it and then have an 
appeal taken on that to the Circuit Court of Ap- 
peals, and then come back and litigate over a bill 
of particuiars which is three or four hundred pages 
long and involves thousands of items. 

In other words, we are duty bound under the 
rules of civil procedure and under plain principles 
of justice to dispose of the whole matter as quickly 
as possible, so I shall examine whatever you have 
and whatever you have submitted with that idea 
in mind. 

Mr. Monteleone: May I make this suggestion, 
if the Court please? If there are any items that 
Mr. McCall desires to check or take exception to 
and serve me with the various items I would be 
very glad to go over the matter with him, and if 
there is any correction we will make the correc- 
tion. Mr. McCall has had a certified accountant 
spend weeks to go over these various items and 
he knows pretty well whether or not there are any 
objections to be made to the items. If he has any 
of those objections before the expiration of the 15 
days that we have to file our briefs, I will be very 
elad to take the matter up with him. 

Mr. McCall: Now one of those objections that 
are mentioned in this letter just filed here is the 
fact that they have charged the subcontractors, 
which they want to pass on to the surety, for one 
man working 25!4 hours in one day, and the checks 
show that they paid him. 


254 Glens Falls Indemnity Co. vs. 


The Court: Maybe he got triple time for over- 
time a couple of hours. 

Mr. McCall: No, 8 hours was straight time and 
17144 hours was overtime. And there are hundreds 
and hundreds of items similar to that one. 

Mr. Monteleone: Mr. McCall just called my at- 
tention to only one. 

Mr. McCall: We called your attention to three 
pages of them, none of which he has given any ex- 
planation of whatever. 

The Court: Have you any more evidence to 
offer in this case now? 

Mr. McCall: That is all. 

The Court: The case will stand submitted. 


CERTIFICATE 


I hereby certify that I am a duly appointed, 
qualified and acting official court reporter of the 
United States District Court for the Southern Dis- 
trict of California. 


I further certify that the foregoing is a true and 
correct transcript of the proceedings had in the 
above entitled cause on the date or dates specified 
therein, and that said transcript is a true and cor- 
rect transcription of my stenographic notes. 


Dated at Los Angeles, California, this 16th day 
of October, A.D. 1946. 


/s/ AGNAR WAHLBERG, 
Official Reporter. 


[Endorsed]: Filed May 16, 1947. 


Basich Brothers Construction Co. 299 


[Title of District Court and Cause. ] 


Before: Honorable Leon R. Yankwich, 
Judge Presiding 


REPORTER’S TRANSCRIPT OF 
PROCEEDINGS 


Los Angeles, California 
Thursday, November 7, 1946, 10:00 a.m. 


The Clerk: Number 5021-Y. Basich Brothers 
Construction Company v. Glens Falls Indemnity 
Company, et al. 

Mr. Monteleone: Ready for the plaintiff, if the 
Court please. 

Mr. McCall: Ready. 

The Court: Gentlemen, I want to explain to you 
the circumstances under which I came to take over 
this case. While we do not have a master calendar, 
ever since I have been on this bench there has been 
a system of passing cases on from one Judge to 
another, where, for some reason, one Judge might 
have more time than the other. As you know, Judge 
Hall is in charge of the criminal department, and 
that department requires a Judge’s complete atten- 
tion, so J expressed a willingness to assist him in 
any matters that he felt needed immediate atten- 
tion. He chose this case, and, under the rule, trans- 
ferred it to me, with the consent of the senior Judge. 
An order was entered to that effect in complhance 
with the rules, signed by all three of us. He having 
set aside the submission, it was necessary to call 
you in to discuss the matter. 


256 Glens Falls Indemnity Co. vs. 


Mr. Monteleone: So far as the plaintiff is con- 
cerned, we are agreeable that the matter may stand 
resubmitted before vour Honor. 


The Court: I understand all the briefs are in. 
J have not read them. I have just glanced through 
the files and all the documentary evidence. The 
evidence is mostly documentary, except certain pro- 
ceedings that were had on the pre-trial, which have 
been reported. 


Mr. McCall: Yes, your Honor, the briefs are 
in. My. Monteleone, for the plaintiff, filed an open- 
ing brief, and we have filed our reply. He filed his 
closing brief, but in his closing brief—as I was 
talking to him a minute ago, he raised a question 
which had not heretofore been raised in any briefs, 
and that is the question, whether or not the laws 
of Arizona control over the laws of California. 


The Court: Yes, I noticed that he claimed that 
the rule of modification of contract does not apply. 
That it is apphed more liberally in Arizona than 
in California. That is known as strictissimi Juris. 

Mr. McCall: I would like an opportunity, may 
it please the Court, to reply to that question. 

The Court: The only briefs I find are the points 
and authorities of plaintiff. That is way back. 
There is a late brief. There is a very small brief 
ealled: Points and Authorities of Plaintiff in Sup- 
port of Its Complaint. 


Mr. Monteleone: That is correct. 
The Court: Then you have the Glens Falls 


Basich Brothers Construction Co. 2a 


brief, which is a large brief, and that is denomi- 
nated: Reply Brief ? 

Mr. McCall: That is correct. 

The Court: Then Mr. Monteleone’s closing brief. 

Mr. McCall: It is in his closing brief that he 
raised for the first time the question of the Arizona 
law; and that is what I would like permission of the 
Court to reply to. 

Mr. Monteleone: {£ may state in that regard, I 
have no objection to Mr. McCall replying, but the 
issue was not raised, and the first time the issue as 
to the Arizona law was raised was in answer to the 
contention held by Mr. McCall in his brief that 
the strict rule of construction adopted in Cali- 
fornia 


The Court: In other words, there was an issue 
tendered by Mr. McCall in his brief that there was 
a modification of the contract, which relieved the 
surety. 

Mr. Monteleone: ‘That is correct. 

The Court: To which you replied in a general 
way that there was no modification; if there was, 
they knew of it, but by failure to act within two 
months they waived it, is that correct? 

Mr. Monteleone: That is correct. 

The Court: I have to familiarize myself with 
the issues. You gentlemen, in reply to each other’s 
brief, have made it easier; you have picked up the 
brief, and found the corresponding answer under 
the same heading and subheading, which is very 
helpful to a Judge, especially one like myself, who 


258 Glens Falls Indemnity Co. vs. 


does not have a law clerk to analyze them, and hand 
it over to me, because I enjoy that work too much, 
and do it myself. Is there any question to the suf- 
ficiency of the notice by any subcontractors, under 
the statute; the notice by subcontractors to the 
surety of any claim under the contract? 

Mr. McCall: There is no claim by subcontract- 
ors. This is a general contractor. 

Mr. Monteleone: If your Honor please, in this 
matter the basis of the plaintiff’s action is to re- 
cover for labor and material and supplies furnished 
the subcontractor. 

The Court: In ex rel Hargis v. Maryland Cas- 
ualty Co., 64 Fed. Supp. 522, it merely involved the 
sufficiency of the notice, by one furnishing materials 
to the subcontractor. I don’t think that is involved 
here. There I held that actual notice took the place 
of any defect in the formal notice; especially where 
the contractor was a party and received bills 
addressed jointly to him and the subcontractor, that 
it was almost a contract for the benefit of a third 
party. [ don’t think that is involved. At any rate, 
it is an interesting problem, and you may want to 
read the case. 

Mr. McCall: I checked that case, your Honor. 
There is a question—the defendant defends on one 
point, that the plaintiff, who is a general contractor, 
did not give prompt notice. 

The Court: Let me ask you one other question. 
I notice a very elaborate bill of particulars, and in 
looking at the transcript I notice, J think at the 
pre-trial, some suggestion was made about giving 


Basich Brothers Construction Co. 259 


one amount, and a total disagreement as to the 
amount actually paid out. 

Mr. McCall: Yes, your Honor, the defendant is 
unable to determine what amount was paid out 
under the subcontract, and what amount was paid 
out under the general contract. And our auditor— 
it wasn’t necessary to find the line of demarkation 
between the two. Mr. Monteleone, is submitting our 
evidence, which we had agreed on, wound up by 
stating it is our understanding we are submitting 
this on the question of habilitv, and if the Court 
should find there was no liabihty on the part of the 
defendant that would end the case. If the Court 
should find that there is liabilitv on the part of the 
defendant then under our former agreement it 
would be necessary to try the question of the 
amount of liability, if any. Anv suggestions from 
vour Honor I would be glad to have. 

The Court: JI may say, gentlemen, I have in the 
past submitted matters in that maner, but the older 
I get the more satisfied I am that that is an unsatis- 
factory way, unless the situation is such as we 
encounter in tax cases, where the onlv question is 
liability of the taxpayer, and the amount can 
readily be computed. For that reason we have 
adopted a rule from the Tax Court that in all these 
eases the Court may render judgment for the de- 
fendant, the amount of judgment to be comvuted 
by the parties. Of course, there it is only a matter 
of computation. It could be done without taking 
evidence. 

My. Monteleone: In this matter, if vour Honor 
pleases, the records of the plaintiff show that the 


260 Glens Falls Indemmity Co. vs. 


items set forth in the bill of particulars were monies 
actually paid for labor or supphes that were fur- 
nished to the subcontractor. The defendant had 
been given an opportunity of having a certified 
accountant spend three weeks, at least, going over 
the books and records, and I indicated to Mr. Mc 
Call if there were any items that were questioned 
by Ins auditor we would be very glad to submit 
those matters to the Court. But, the amounts were 
actually paid out on account of the subcontractor, 
and on no other account. If it is necessary to bring 
in the auditor who made the entries we will be 
glad to do so, but I thought after Mr. McCall’s 
auditor had gone over the records and spent so 
much time, they would accept it, except for a few 
minor matters that came up in the last hearing 
before Judge Hall. 

The Court: The last hearing before Judge Hall 
was September or July? 

Mr. McCall: There was a hearing in July. The 
last one was in September. 

The Court: July 8th. That is denominated pre- 
trial hearing. 

Mr. Monteleone: We had a pre-trial hearing, 
and then a later hearing before Judge Harrison. 
That matter was transferred back to Judge Hall. 

The Court: So long as we have time this morn- 
ing, gentlemen, we may as well discuss it. That was 
the object in bringing you here, to find exactly how 
the situation was. Here is the last one, September 
30th, before Judge Harrison, and October 4th, be- 
fore Judge Hall. 


Bastch Brothers Construction Co. 261 


Mr. McCall: That is the last time we were in 
Court, your Honor. 

The Court: I notice Judge Hall raised exactly 
the same question I raised, and I had not seen 
this record; J merely looked at July. 

Mr. Monteleone: What point is that, your 
Honor? 

The Court: That is with regard to the amount. 

Mr. McCall: That was raised by Judge Har- 
rison. . 

The Court: Reading from the transcript of the 
hearing of October 14, 1946, beginning at the bot- 
tom of page 10: 

‘“My. McCall: The reason of that, your Honor, 
is that it will show the Court the way the bill of 
particulars is built up and that the items are such 
that counsel cannot possibly stipulate to them. I 
see no way that they can be determined except by 
trial, either before the Court or before a master. 

“The Court: Item by item? 

““Mr. McCall: Well, we have no proof of the 
items, your Honor. There was millions of collars 
spent at this place. 

“The Court: Do either of you have any further 
exhibits or evidence to offer in the case at this 
time ? 

‘“‘Mr. Monteleone: We have none, if the Court 
please. 

‘‘Mr. McCall: None. 

“The Court: The matter will stand submitted, 
with this proviso, that upon examination of the 
files and records, when I get to it I may restore 
it to the calendar for some testimony. 


262 Glens Falls Indemnity Co. vs. 


‘“Mr. McCall: It is understood that this evidence 
heretofore submitted by counsel for the plaintiff 
and the defendant is on the question of Habilitv 
only, is that right? 

“The Court: I do not know what it is on. I did 
not hear it. 

‘“Mr. McCall: It was stipulated between counsel 
before that we would submit this evidence and then 
it would be submitted on briefs, and that was the 
original idea. 

‘‘The Court: Have you filed your briefs? 

‘‘Mr. Monteleone: I have, if the Court please. 

‘‘Mr. McCall: I have not filed a brief, and his 
brief is not designated as an opening brief. It is 
only designated as points and authorities, and I do 
not think it does his case justice, and I don’t want 
to take the advantage of him. If he wants to de- 
nominate that as his opening brief, I shall certainly 
he glad to file a reply to it. 

‘‘Mr. Monteleone: I will stand on what I file, 
if the Court please. 

“The Court: You do not desire to file any 
further briefs? 

‘“Mr. Monteleone: No, I am satisfied with the 
brief I have already filed. 

‘“Mr. McCall: Then may I file a replv brief? 

‘“The Court: How long will vou want for vour 
replv brief? 

‘“Mr. McCall: JI would like to have 30 days. 

‘The Court: I thought you were in a hurry to 
get this case decided. You can write a brief in 10 
days. 

“Mr. McCall: I think I can. 


Bastch Brothers Construction Co. 263 


“The Court: You will have 10 days to file a 
reply brief and the plaintiff will have 5 days there- 
after to reply. 

‘“Mr. Monteleone: That is sufficient. 

“The Court: Then after 15 days the matter will 
stand submitted. 

“Mr. McCall: On the question of liability ? 

‘The Court: I haven’t seen it. Whatever you 
have here will be examined. 

‘‘l want to suggest this, however, that if it is at 
all possible to try this lawsuit all at once, it is my 
purpose and intention that it shall be tried rather 
than to determine a portion of it and then have an 
appeal taken on that to the Circuit Court of Ap- 
peals, and then come back and litigate over a bill 
of particulars which is three or four hundred pages 
long and involved thousands of items. 

‘‘In other words, we are duty bound under the 
rules of civil procedure and under plain principles 
of justice to dispose of the whole matter as quickly 
as possible, so I shall examine whatever you have 
and whatever you have submitted with that idea 
in mind. 

‘“Mr. Monteleone: May I make this suggestion, 
if the Court please? If there are any items that Mr. 
McCall desires to check or take exception to and 
serve me with the various items I would be very 
glad to go over the matter with him, and if there 
is any correction we will make the correction. My. 
McCall has had a certified accountant spend weeks 
to go over these various items and he knows pretty 
well whether or not there are any objections to be 


264 Glens Falls Indemnity Co. vs. 


made to the items. If he has any of those objections 
before the expiration of the 15 days that we have 
to file our breifs, I will be very glad to take the 
matter up with him. 

‘“Mr. McCall: Now one of those objections that 
are mentioned in this letter just filed here is the 
fact that they have charged the subcontractors, 
which they want to pass on to the surety, for one 
man working 2514 hours in one day, and the checks 
show that they paid him. 

‘“The Court: Maybe he got triple time for over- 
time a couple of hours. 

‘“Mr. McCall: No, 8 hours was straight time and 
1714 hours was overtime. And there are hundreds 
and hundreds of items similar to that one. 

‘“Mr. Monteleone: Mr. McCall just called my 
attention to only one. 

“My. McCall: We called your attention to three 
pages of them, none of which he has given any 
explanation of whatever. 

“The Court: Have you any more evidence to 
offer in this case now? 

“Mr. McCall: That is all. 

‘The Court: The case will stand submitted.’’ 


I would say, Mr. Monteleone, that while the Court 
did not specifically say that it was submitted on the 
question of lability it was merely because he had 
had no occasion to examine the file and briefs and 
determine it. Mr. McCall made it very plain that 
it did not submit the matter as to the amounts 
collected. So that is a matter that will have to be 
determined in one way or another. 


Bastch Brothers Construction Co. 269 


Mr. Monteleone: If your Honor please, we will 
be very glad to bring the auditor, and bring all the 
cancelled checks to show what was actually paid out, 
and to whom payments were made. 

The Court: It is against my custom, and Judge 
Hall intimated it is against his custom, to try to 
work out the matter in this manner unless the 
matter is purely a question of accounting that can 
be taken care of. I don’t send lawsuits to a master. 
[I am opposed to masters. I never used a master in 
mv hfe, in the Superior Court or here, except in 
an accounting. 

When it comes to the question of liability, that 
is a different question than accounting. There you 
are confronted with hability, and whether an item 
is proper and so forth. I am in a better position to 
determine that, than to have to do it later from a 
transcript before a master. I remember, in the 77-B 
proceeding they had in the Rindge estate, I had 
claims amounting to nearly a million dollars, and 
counsel asked me if I would not send it to a master. 
I said no, I would take it myself. It took 11 or 13 
days to try it, and I drew only one appeal out of 
the entire group. I am certain if it had been sent 
to a master it would have drawn more appeals 
than that. 

In a case like this, it is not determining what the 
books show. It is what actually was paid, to deter- 
mine liability. 

Mr. Monteleone: That is correct, if your Honor 
please. The reason I suggested to Mr. McCall, if 
there was any actual question that the bills were 


266 Glens Falls Indemnity Co. vs. 


actually paid, it is a different matter. I don’t under- 
stand Mr, McCall to raise the question that the bills 
were actually paid. 

The Court: It is not a question of whether they 
were paid, but whether they were correctly paid. 

Mr. Monteleone: He does not raise the question. 
In other words, we have the payroll of the subcon- 
tractor of what was paid in actual wages, and there 
was equipment rented by the subcontractors, and 
the rentals were paid. I don’t know whether your 
Honor has read the deposition. 

The Court: Not yet. I only got this yesterday 
morning. I work fast, Mr. Monteleone, but not that 
fast. 

Mr. Monteleone: The amount of rental paid was 
under O.P.A. regulations, so there is a question as 
to the reasonableness of it. If your Honor desires 
to give us a date to prove those items, I would be 
very glad to bring the auditor and parties in and 
prove all of those items set forth in the bill of 
particulars were paid, for labor or rental on equip- 
ment used by the subcontractor. 

The Court: So long as the matter was submitted 
to: Judge Hall with this understanding I think we 
had better let it stand as it is, with this under- 
standing also: That I may, if I choose, regardless of 
which way I decide it, call for additional testimony 
to be presented on the subject of damages, because 
there is this situation: Supposing I find no Nability, 
and supposing you are wrong, how are vou going to 
make findings’ unless you waive findings as to the 
‘amount? 


Bastch Brothers Construction Co. 267 


Our Circuit Court of Apeals has interpreted the 
new rules rather strictly. They have required find- 
ings on a non-suit, which is unheard of in modern 
procedure. The idea of a non-suit is that you have 
no claim; that you have not proven a cause of 
action. What kind of findings could you make? 
Negatives ones. So we have to watch constantly as 
to what they are going to do next. 

Therefore, it would not do to decide liability, and 
then have no testimony in the record one way or 
the other as to the amount, assuming there was 
liability. Suppose I had decided against liability; 
you then took an appeal, you would have to protect 
your record, and would have to have findings. I 
would have to make findings as to the amount, 
unless you waived findings as to that amount. If 
you do that, you mav go up, and I may be wrong, 
and the case will have to come back. 

Mr. Monteleone: I think the Court’s suggestion 
is appropriate. We are agreeable. 

The Court: If I knew more about the case T 
would fix a date now; but so long as there is 
another brief due I will let the brief come in, I will 
consider the matter, and will then probably eall 
you in. In a ease like this the best way is to leave 
the matter, as I am doing now, and J will deter- 
mine whether further proceedings are necessary. 
Mr. McCall might recede from his position, and be 
satisfied with a reaudit, or something like that. But 
certainly, as there is another question being raised, 
I think we will let it stand as it is. That is, the 


268 Glens Falls Indemnity Co. vs. 


matter will stand submitted when the final brief 
is in. 

How much time do vou want for your additional 
brief? Limit it to one point, as to what the law of 
Arizona is on the subject. Or do vou contest whether 
the law of Arizona governs? 

Mr. Monteleone: That is the main point, it 
seems to me. 

Mr. McCall: There was another point that he 
raised for the first time in his closing brief. 

The Court: Under the decision in the famous 
ease of Erie Railroad v. Tompkins, in the matter 
of contracts, the law of the state governs where the 
contract was made and the contract was performed. 

Myr. McCall: That is our position, your Honor. 
He alleges in the complaint that the surety bond 
was given to the corporation at its headquarters in 
Alhambra, and was executed and delivered here, 
and, if there should be a judgment for the plaintiff 
in this case it is elementary that it would be paid 
here. So that is our position. We have that case 
your Honor just mentioned, and several others on 
that point we would like to submit. 

There is one more question in the plaintiff's 
closing brief. He also raises the question of waiver, 
and I don’t have the brief with me where he said 
if the Court should find that he should have pleaded 
waiver that he asks permission to amend his com- 
plaint, and he sets out what he would like to put 
in his amended complaint. It is our position that 
that would be stating a new cause of action. We 
would like to be heard on that point. 


Basich Brothers Construction Co. 269 


The Court: Here is his closing brief. He calls 
it a reply brief. Of course, gentlemen, you realize 
this: that under our liberal rules of pleading the 
Court may find facts in accordance with the record, 
even without any amendments. The section is 
very plain on that subject: Rule 15 (b): 

‘*When issues not raised by the pleadings are 
tried by express or implied consent of the 
parties, they shall be treated in ail respects as 
if they had been raised in the pleadings. Such 
amendment of the pleadings as may be neces- 
sary to cause them to conform to the evidence 
and to raise these issues may be made upon 
motion of any party at any time, even after 
judgment; but failure so to amend does not 
affect the result of the trial of these issues.”’ 


And under that you can change the theory of 
the entire action. 

Mr. McCall: It is my understanding of the law 
that no testimony can be introduced on waiver un- 
less waiver has been pleaded by plaintiff. There- 
fore, in my brief I did not cover the question of 
waiver as I would have covered it, had it been 
raised. Is it O.K. for me to cover that point briefly 
in my reply? 

The Court: All right. You want to review the 
question as to whether the Arizona law or the Cali- 
fornia law covers it. Of course, the obligations of 
a contract would be covered by the place of per- 
formance. The obligation of the surety ordinarily 
would be governed by the place where the surety’s 


270 Glens Falls Indemnity Co. vs. 


undertaking was executed, and is to be performed. 

Since the famous Tompkins case, the Cireuit 
Court of Appeals in a case of mine, Ostroff v. New 
York Life, has held that where the party takes out 
a life insurance contract, and resides here, and the 
company has an office, it is a California contract, 
despite the fact that the contract says that the 
premiums are due in New York, and also that anv 
benefits are to be paid in New York. They took 
judicial notice of the fact that all large companies 
maintain offices here. 

IT am familiar with the case involving surety. 
That was one of the cases of our Circuit, where they 
ruled the other way. That was one of the cases I 
agreed to try piecemeal. The result was just as 
I predicted. I held, because the contract said pre- 
miums are paid in New York and benefits are paid 
in New York, regardless of the effect that as an 
accommodation they are actually payable here, be- 
cause they have an office in every large city in the 
country, would make it a New York contract. The 
non-contestability clause in New York has been 
interpreted to be within the statute of lmitations. 
Not even fraud can get behind it. But the Cali- 
fornia courts have held the other way. So just by 
interpreting one contract rather than another, the 
entire complexion of a lawsuit is changed, they 
having held that it is a California contract; and 
our courts have held that fraud, and making mis- 
representations as to help, are grounds for setting 
aside, they have held that you can try a case on its 
merits. 


Basich Brothers Construction Co. O71 


Mr. McCall: That is similar to the case we have 
ere. 

The Court: It just happened to come to me 
indirectly. Of course, had they sustained me the 
lawsuit would have been at an end, but it would 
have been much better, and would have saved a lot 
of time had I proceeded to try it. 

Mr. McCall: On that point, I think in fairness 
to Court and counsel, it might be stated that the 
reason counsel for the plaintiff and I agreed to 
submit the case, in the first instance, when we 
reached that conclusion, was because we could not 
get a trial date, and it might be if this Court would 
prefer to give us a date we could handle the whole 
thing at one time. 

The Court: I can’t say at the present time. 
I took it with the idea that it could be decided on 
the record. Of course, Judge Hall has the crimina} 
department. Had he told me this last week my 
attitude would have been different. As it is, I have 
filled my calendar on all of the trial dates, and I 
am to be in San Diego for two weeks in December. 
At the present time I think it would be just as 
well to let it stand, because if we reopen it for 
additional testimony I don’t think it should he a 
lengthy proceeding. 

Mr. McCall: That is right. I am happy to sub- 
mit it on that proposition. 

Mr. Monteleone: How much time, Mr. McCall, 
do you want? 

Mr. McCall: I will finish this week. Monday it 


272 Glens Fails Indemnity Co. vs. 


will be wound up. If the Court says, I will make it 
tomorrow. 

The Court: There is no such rush. I will have 
your closing memorandum, limited te two ques- 
tions only: Whether the issue of waiver is before 
the Court on the pleadings; and, second, whether 
the question of modification is governed by the 
Arizona or California law. 

Mr. Monteleone: If vour Honor please, I have 
1un into a California case. I don’t have it with 
me now, because I came directly from Pomona to 
be here this morning. It is a recent Supreme Court 
decision, and holds that where a special defense is 
raised in the answer, raising matters which the 
plaintiff does not concede, that vou are not required 
to allege in your complaint any allegations of 
estoppel. It did not go to the point of waiver, but 
was confined to the question of estoppel. In other 
words, in our complaint we do not concede that we 
did not give the notice, or there was any default, 
as contended by defendant. The issue .is raised in 
the pleadings the first time, by the answer. 

The Court: You cannot anticipate. Under the 
present system of pleadings vou do not need to 
deny any new matter. 

Mr. Monteleone: The Supreme Court has held 
we are not required to allege and anticipate in the 
complaint the question of estoppel, by having a 
pleading to that effect. It is waived. 

The Court: We will let the matter stand for the 
present, I will give you five days time for a closing 
memorandum on those two questions. 


Basitch Brothers Construction Co. 78s 


Mr. McCall: There is one more question here, 
your Honor. In the pre-trial memorandum, if that 
is what it is called, of October 14th—I believe it 
was in Judge Hall’s court—that is, the date when 
we were handing in our exhibits, at my request he 
ordered that the insurance policies mentioned in 
Schedule 7 of plaintiff’s bill of particulars be 
brought into the court. He made an order that 
those insurance policies be brought into court as 
exhibits. We have never seen those, and counsel for 
the plaintiff stated at that time, according to the 
record, that they would be brought in. They were 
filed, but I checked the record yesterday, and they 
had not been filed, according to the record. There 
is one compensation policy, which has been filed, 
and another one, and it does not refer to this par- 
ticular job. 

The Court: What is that? 

Mr. McCall: There was only one compensation 
policy, which has been filed, complying with the 
order of the court, and it is dated 1943. It refers 
to two other jobs. It does not refer to this job, 
and it does state that there is no sube¢ontractor on 
the job. 

The other insurance policy, may it please the 
Court, has been brought into court. I suggested 
that they be brought in, so that the Court could 
have them before it. 

Mr. Monteleone: As far as the compensation 
policy is concerned, as Mr. McCall has stated, it 
does not cover this job. It seems the state of Ari- 


274 Glens Falls Indemnity Co. vs. 


zona has a procedure in making an order in 
Phoenix, or wherever the headquarters are, to ex- 
tend the policy to cover other jobs. That was done 
in this particular case, although it does not appear 
in the policy itself. The policy is the existing policy 
until eaneelled, and has recently been cancelled by 
the state of Arizona. So the policy introduced in 
evidence is the policy which covers this particular 
job. 

Mr. McCall: Counsel prebably is quite correct, 
that one policy will be used for several jobs, as 
the jobs are taken in. There is what is called a 
rider attached to each policy. There is nothing 
attached to this policy, and it indicates on its face 
to refer to two other jobs back in 1933 and 1934, 
and excludes this job. 

The Court: I don’t know as to what issue that 
is material. 

Mr. McCall: Jt is our position that for one de- 
fense—I believe it is No. 10, that there was never 
the relationship of obligee and principal between 
the parties in question, that 1s between the general 
contractor and the subcontractor, for the reason 
that a long time before they got the bond, and un- 
known to the surety, the general contractor put the 
alleged subcontractor on a job, took out all of his 
insurance for him, or rather all of his employees 
were covered in the policy—-all the insurance poli- 
eies which were held by the general contractor. The 
subcontractor had no policies. He had no payroll. 
livery check was written by the general contractor, 
and every act done from then on indicated that 


Basich Brothers Construction Co. 275 


there was the relation of master and servant, in- 
stead of general contractor and subcontractor. 

We asked, way back in July, for the privilege of 
seeing these policies, and finally, when they were 
not exhibited to us, we sent an auditor out to look 
over the records, and counsel for the plaintiff made 
the statement at the last pretrial that these policies 
were exhibited to the auditor, but he denies that, 
and says although he asked for them many times, 
they were not exhibited to him. 

It is my contention that whatever these policies 
show would be material in this case, whether they 
be for us or against us. As a matter of fact, the 
policy which has been submitted, which counsel 
says is the correct one, states, in answer to the ques- 
tion, that there is no subcontractor on the job. That 
is the reason, your Honor, we would like to have it 
submitted. 

The Court: Can you identify those? 

Mr. Monteleone: J have produced the only com- 
pensation policy we have, issued by the State of 
Arizona. Counsel has been given the opportunity 
to check in Arizona the public records, and if he can 
find anything else, I have no objection that they be 
introduced into evidence. We don’t have anything, 
except what I introduced, except there may be 
public liability policies. All we had we introduced 
in evidence. 

Mr. McCall: May I call the Court’s attention to 
page 2 of Schedule VI, page 2 of the Bill of Par- 
ticulars, where the plaintiff has listed, ‘‘Insurance 
includes Compensation, Public Liability, Property 


275 Glens Falls Indemmty Co. vs. 


Damage, California Unemployment, Federal Old 
Age and Federal Excise,’’ for which he has, in his 
Bill of Particulars, charged the defendant $9,216.51. 

Mr. Monteleone: Under the subcontract, if your 
Honor please, it provides specifically 1f the sub- 
contractor fails to make these payments, the prime 
contractor can make the payments and charge them 
against the subcontractor. 

The Court: That is contained in most of the 
contracts. 

Mr. McCall: And in the case counsel refers to, 
that is why the subcontractor takes out insurance, 
or it is taken out for him. Then the general con- 
tractor pays for his premiums, that is not the case 
here. We have never been permitted to see the 
policies for which he is charging us $9,216.51. He 
says he does not have them. 

The Court: If a definite order has been made, it 
should be comphed with, but it seems to me that 
those contracts have a bearing only on the particu- 
lar item, and we have decided to leave the question 
of the amounts open for the present. Any state- 
ments or admissions that may be contained therein 
that might be used on another issue cannot be deter- 
mined until they are produced. 

Mr. McCall: That’s right. If he never pro- 
duces them we will never have the advantage of 
them in our defense. 

Mr. Monteleone: If your Honor please, again I 
advise that all I know is that it is the contention of 
the plaintiff that the policy introduced in evidence 


Basich Brothers Construction Co. Day 


was by an order made in Arizona extended to cover 
this particular job. 

The Court: It is up to you to produce the order 
made in Arizona which made it applicable to other 
jobs. 

Mr. Monteleone: Do you want the publie la- 
bility policies? 

Mr. McCall: It has been stipulated several times 
he would bring them in—all of these policies men- 
tioned on page 2 of our Bill of Particulars, for 
which he seeks to charge us. 

The Court: The Bill of Particulars merely 
sums them up. 

Mr. McCall: I might say this: The plaintiff has 
refused and failed to tell us what the companies 
are, and the policy numbers of the policies, when 
they were written, or anything about them. 

My. Monteleone: Mr. McCall, I have not refused 
you anything in that respect. You know it to be a 
fact. 

Mr. McCall: May it be stipulated here then that 
those companies, and the names of them will be 
brought in, and the policies filed. 

The Court: I think we will have to make a 
change in the form of the order. I will ask the 
plaintiff to further particularize the items set forth 
on page 2 of Schedule VI, Insurance, by giving the 
names of the companies, and that the originals be 
left with the Clerk, not as exhibits, but be left with 
the Clerk so counsel may examine them. That will 
not interfere with your writing your brief, will it? 

Mr. McCall: No, it will not. If any questions 


278 Glens Falls Indemmty Co. vs. 


come up as a matter of defense, I am sure the Court 
will consider them. 

The Court: As long as J mentioned two com- 
panion cases, I will state that my opinion was pub- 
lished in 28 Fed. Sup. 724, dated June 17, 1938. 
The opinion of the Cirewit was rendered on July 
21, 1989, and is reported in 104 Fed. 2nd, 986: 
Judge Wilbur dissented. He felt my interpretation 
was correct. There was this companion case which 
follows that, in which there is also a dissent. This 
case was right after the Erie-Tompkins case said 
there was no Federal law, and we were trying to 
find out as to each contract, what kind it was. You 
can see that our judges of long experience have 
trouble in agreeing whether a contract is covered 
by one law or another. 

The matter will stand submitted, and [I will leave 
the other matter open, and when I reach a conelu- 
sion as to the legal questions involved I will either 
give you written notice, or call you up and tell you 
what conclusion I have reached. If it becomes 
necessary to take additional testimony, we will fix 
a time. 

The Clerk: There is no objection by counsel to 
the submission of this case? 

Mr. MeCall: There is none. 

Mr. Monteleone: No objection. 

Mr. McCall: There is no otime limit in which to 
submit the insurance? 

The Court: Five days. 

Mr. McCall: Five days from my memorandum? 

The Court: Five days, running from today. 


Bastch Brothers Construction Co. 279 


That is why [ asked you if you wanted to see them 
before you wrote your memorandum? 

Mi. Monteleone: it may be I will have a ecerti- 
fied of the order from Arizona. 

The Court: Do you want 10 days? 

Mr. Monteleone: Yes. 

The Court: Then it will be 10 days, and they 
will run simultaneously. Let us have a distinct 
understanding that I will determine what, if any, 
additional testimony should be taken, and by whom, 
on the question of the amount. 

Mr. McCall: Yes, your Honor. 

My. Monteleone: That is agreeable to the 
plaintiff. 


CERTIFICATE 


I hereby certify that I am a duly appointed, 
qualified and acting official court reporter of the 
United States District Court for the Southern Dis- 
trict of California. 


I further certify that the foregoing is a true and 
correct transcript of the proceedings had in the 
above-entitled cause on the date or dates specified 
therein, and that said transcript is a true and cor- 
rect transcription of my stenographic notes. 


Dated at Los Angeles, California, this 3rd day of 
January, A.D. 1947. 


HENRY A. DEWING, 
Official Reporter. 


_ [Endorsed]: Filed May 16, 1947. 


280 Glens Falls Indemnity Co. vs. 
[Title of District Court and Cause. ] 


REPORTER’S TRANSCRIPT OF 
OF PROCEEDINGS 


Los Angeles, California 
Monday, November 25, 1946, 2:00 p.m. 


Hon. Leon R. Yankwich, Judge Presiding. 


The Court: Gentlemen, I have called you here 
to discuss with you certain matters, some of which 
relate to the condition of the record. Briefly, I may 
sav that I have had an opportunity to study the 
voluminous files in the same, including the deposi- 
tions. I have devoted both the weekend before last 
and last week to the study of this record. 

There are certain things that are not clear, that 
should be clarified. I presume you are not to blame, 
because all the stipulations were oral, and entered 
into in open court; but it is very easy at times to 
overlook certain particular things, especially when 
the case goes to one judge, then to another judge, 
and back to the same judge again. Now it has 
Come tor mie: 

After the case was transferred to me I told you 
I was not in a position to make any suggestions, 
because I had not studied the record. JI merely had 
made a cursory examination of the pleadings, to 
know what it was all about. Since then, as I have 
said, I have studied the record, studied the deposi- 
tions, and there are several things which oceur to 
me which should be rectified in the record. 

In the first place I find that when the case was 
returned to Judge Hall, certain documents which 


Basich Brothers Construction Co. 9] 


and 


have heretofore been identified in Judge Harrison's 
court, and as to which an order was drawn, were 
offered in evidence by both sides. Thev were suffi- 
ciently identified by number. However, the record 
1s not certain; at least i find no indication in writ- 
ing, that the depositions which are in the file have 
ever been introdueed. As you know, the mere depo- 
sition does not in itself make it available as an item 
of evidence. 

We have three depositions in this matter. First, 
there is a deposition of Mr. Basich, which is a part 
of the file, attached to volume No. 1, and which was 
filed June 29, 1946. That deposition was taken on 
behalf of the defendant, being the deposition of Mr. 
Nick L. Basich. I gather that counsel, from the 
arguments they are making and the reference 
thereto, intended that this should be introduced in 
evidence, but there is no mark by the Clerk to indi- 
eate that any of the three depositions were intro- 
dueed. 

Mr. Monteleone: That was our understanding, if 
the Court please. Probably it was an oversight on 
the part of Mr. McCall and myself. So far as the 
plaintiff is concerned, at this time we offer the depo- 
sition of Nick L. Basich in evidence. 

Mr. MeCall: There is no objection. 

The Court: The record shows that Plaintiff’s 
Exhibits 1 to 19, have been received. 

The Clerk: There are numbers missing. What 
numbers are we going to assign to the depositions? 

The Court: They are in by reference. There is 
nothing attached to the Basich deposition. There 
are some exhibits attached to the other depositions. 


282 Glens Falls Indemnity Co. vs. 


That will be No. 20 in evidence. You will find that 
many of these exhibits are attached to both the 
complaint and answers, and were received by refer- 
ence, In that manner. I don’t think any copies are 
missing. 
| Plaintiff's Exhibit No. 20 set out in full 
following Reporter’s Transcript—See Index for 
Page Number. ] 


Mr. Monteleone: All the copies were introduced 
in evidence and marked as exhibits before Judge 
Harrison, if your Honor please. 

The Court: "Then they were withdrawn and re- 
introduced before Judge Hall, because Judge Harri- 
son, when he decided not to go on with the ease, told 
you to withdraw your exhibits. 

Mr. Monteleone: That is correct. 

The Court: You made an argument based on the 
depositions which are not technically in evidence. 
I am not trying to be too technical, but they are 
absolutely necessary for any record you may want 
to prepare in the case. 

The next deposition is a deposition of George W. 
Kovich, who was a Basich foreman, or superintend- 
ent of the job—whatever he called himself. 

Mr. Monteleone: At this time, if the Court 
please, plaintiff offers in evidence the deposition of 
George W. Kovich, which has already been pre- 
sented to the Court. 

Mr. McCall: No objection. 

[ Plaintiff’s Exhibit No. 21 set out in full 
following Reporter’s Transcript—See Index for 
Page Number. ] 


Basich Brothers Construciton Co. 283 


The Court: That was filed August 12, 1946. That 
will be Plaintiff’s Exhibit No. 21. Then we have 
the deposition of Mr. Bray, the investigator who 
went down to the job, and made certain observa- 
tions and certain reports to the defendant Indem- 
nity Company. 

Mr. Monieleone: At this time, if the Court 
please, plaintiff offers in evidence the deposition 
of John Bray. 

My. McCall: No objection. 

The Court: All right. As to the other exhibits, 
aside from the prime contract and the insurance 
policy, they were all in the letter, and, as I have 
said, I have not completed my study of the case, 
although I have read all the pleadings in the ease, 
and have made some study of the law. 

The Clerk: The deposttion of John H. Bray, 
filed September 30, 1946, is Exhibit No. 22 in 
evidence. 


[Plaintiff’s Exhibit No. 22 set out in full 
following Reporter’s Transeript—See Index for 
Page Number. ] 


The Court: Then, subject to any further order 
the Court shall make, it is understood that the 
matter is submitted by both sides upon the deposi- 
tions and documentary evidence? 

Mr. Monteleone: That is correct. 

Mr. McCall: Yes. 

The Court: That disposes of that. There is one 
other matter. 

Mr. MeGall: Your Honor, we have these in 
numerical order, and if it will do any good for me 


284 Glens Falls Indemnity Co. vs. 


to read them to the Clerk as we introduce them 

The Court: You can identify them for the bene- 
fit of the Clerk so vou will have a record. My 
Clerk usually has on the front page a record of the 


exhibits. 

The Clerk: Are these exhibits now in evidence? 

Mr. Monteleone: We have stipulated that the 
exhibits that were introduced before Judge Harri- 
son may be deemed introduced before this court in 
the same order as they were introduced before Judge 
Harrison. 

The Court: Have you a list of the exhibits? 

Mr. McCall: Yes, your Honor. 

The Court: Will you hand it to the clerk so that 
he can reflect the exhibits. 

The Clerk: What shall I do when I locate them 
—physically detach them? 

The Court: Certainly. The plaintiff attaches a 
bunch of letters, and the defendant, to make sure, 
attaches the same to his answer. 

Mr. McCall: Would it help if I would read these 
out? 

The Conrt: Some of them are duplicates. There 
is another matter I want to talk to you about. 

Mr. McCall: May it please the Court, my associ- 
ate just called my attention to the fact that these 
exhibits are listed from 1 to 19 in the transcript of 
September 30th before Judge Harrison. 

The Court: What page? 

Mr. McCall: Page 3. 

.The Court: Here is the transcript of the pro- 
ceedings before Judge Harrison. You can check 


Basich Brothers Construction Co. 235 


that list against tlis list. There is just one other 
matter I think should be specifically covered. At 
the pre-trial hearing before Judge Hall counsel for 
the defendants offered a stipulation relating to the 
manner in which employees of Duque & Frazzini, 
the subcontractors, were carried on the books, and 
state their relation to the Liability and Workmen’s 
Compensation Acts. The record shows that the 
stipulation was not signed, and it was left with the 
clerk, who evidently filed it at the second hearing. 
However, there is this statement by Mr. Monte- 
leone—I am reading from page 3, lines 16 to 21: 
‘*Y am willing to stipulate, and I do so stipu- 
late now, that all of those records designated 
in the stipulation prepared by Mr. McCall in- 
dicate Basich Brothers as the employers. How- 
ever, we want the privilege of explaining to the 
Court during the trial how it happened that 
Basich Brothers appears as the employers.’’ 


That, of course, leaves the matter absolutely up in 
the air. It isn’t a stipwlation of anything, because 
it is merely a stipulation subject to explanation to 
be given at the trial. There is no further trial to 
be had. The only possible hearing to be had will 
be limited to the question of the expenditures made, 
and the amounts alleged to have been expended; so 
this is left up in the air, and should be corrected. 
The only way it can be corrected is by either stipu- 
lating to all these facts, or signing the stinulation 
which Mr. McCall has offered. and which was filed 
before Judge Hall on Octcber 14th. 


286 Glens Falls Indemnity Co. vs. 


Mr. Monteleon: If vour Honor please, when I 
stated that I wanted the opportunity of explaining— 
on its face itself it may appear that Basich Brothers 
were really the employers of these parties. The 
evidence which the plaintiff proposed to show is 
that Basich Brothers were accommodating Duque & 
Irazzini in order to get a rating from the Work- 
men’s Compensation Commission. 

The Court: That is what you are alleging; that 
is what the testimony is? 

Mr. Monteleone: That’s right. And that Basich 
Brothers had no control or supervision over any of 
the employees of Duque and Frazzini. 

The Court: That is a conclusion which could 
not be stipulated to, because it 1s alleged that they 
did have control, and it is further alleged that Mr. 
Kovich saw them at work; that at least on one ocea- 
sion he countermanded an order; and that from the 
very beginning they were carried not only on the 
books, but the indemnity policies and everything 
else were made to inure to their benefit. That is 
exactly what I want to find out. As this stands sub- 
mitted, I will have to determine it on the basis of 
the testimony of these men, and on the basis of the 
showing made by stipulation, as to whether there 
was control or was not control. 

Mr. Monteleone: That’s the reason I would not 
want to stipulate, because we take the position that 
there was no contro] at any time. 

The Court: Then, gentlemen, you have given me 
a case which simply cannot be decided upon the 
record. There is no stipulation. They will not 


Basich Brothers Construction Co. 287 


stipulate there was no control, because they axe 
arguing you had a measure of control, which is 
incompatible with your position. Therefore, f want 
‘to know, am J to decide that question on the basis of 
the recoid, or am I just going to indulge in an ab- 
stract proposition of law? As it is, I have to try 
the entire lawsuit. 

My. Monteleone: No, your Honor, we want the 
privilege of introducing evidence that Basich 
Brothers had no control whatsoever over the em- 
ployees of Duque & Frazzini. 

The Court: Then, of course, the case is not in a 
position to be submitted. Judge Hall was asked to 
take the submission of the case, and being busy 
thought that all matters that were subject to con- 
troversy could be decided on the basis of the record. 
T have since talked to him. He said he had not made 
a study of the record. He had no time. He merely 
took the view that the case was in a position where 
the Court could decide the question of liability, 
leaving only the other question, and that is the 
question of the amount. 

How can a Court decide the question of lability 
when one of the strongest points urged was that 
there had been a complete modification of the con- 
tract; that as a matter of fact there was some joint 
control in all matters. In reality, although counsel 
does not use that argument, this was not the rela- 
tionship of contractor and subcontractor, but to 
some extent they were engaged in a joint venture 
where, from the very beginning, they did not wait 
for them to fail to pay, but from the beginning 


288 Glens Falls Indemnity Co. vs. 


began paying wages and everything else, which is 
not what the contract says. ‘That is the argument 
being made. How ean I decide lability when the 
question of control is not closed, so far as the evi- 
dence is concerned ? | 

Mr. Monteleone: If your Honor please, that is— 
the reason I would not stipulate unless given an 
opportunity to explain. 

The Court: I am not blaming anyone, gentle- 
men. I am merely pointing out to you what a study 
of this record has convinced me of, so it is quite 
evident from these very things that I am not in a 
position to decide the question of control and the 
question of the advancement of these monies. As 
J said, I am not blaming anybody. But I have 
taken this case over, and these matters occurred to 
me, which I want to discuss with you. In view of 
your statement I may as well stop here. But I am 
not going to stop. I have another suggestion to 
make, and that is this: 

Mr. McCall: Before leaving the point, may I 
state something? It was my understanding that 
when all of these documents were resubmitted before 
Judge Hall counsel said, when I brought this stipu- 
Jation, which I had signed, but which he had not 
signed, that he would stipulate to all matters therein 
contained, or words to that effect. 

The Court: No, he did not. He reserved the 
right 

Mr. McCall: That was in the first case. 

The Court: There is no reference to this par- 
ticular stipulation in the hearing on October 14th. 


Basich Brothers Construction Co. 289 


+ have the record in front of me. If you ean find it 
I will be very glad to have you call my attention to 
it. The record is so voluminous that I wil! admit 
that 1 may have overlooked something, but [ am 
quite sure, if you will examine the entire tran- 
seript—it is very short—you will find no reference 
to that stipulation. 

Mr. McCall: I have before me the proposed 
stipulation, and if it is in order, I would suggest 
that counsel indicate what he is unable to stipulate 
to, and that might settle the whole question. I will 
just read this stipulation, and he can indicate what 
he is unable to stipulate to, and why. 

The Court: That would be negative. He ealls 
for a stipulation, but makes reservations. He wants 
some evidence to explain how things came about. 

Mr. Monteleone: ‘That is correct. 

The Court: If that be true the case is not ready 
for submission, even on the question of liability, 
because there is evidence which the plaintiff desires 
to offer to explain how those things came about; 
and he has a right to do that. 

Mr. McCall: Control, I do not think, was men- 
tioned in this stipulation. 

The Court: No, control is not mentioned; but 
the fact that they were carried is made one of the 
bases of your argument; that if the California law 
applies, these men modified the contract right from 
the very beginning. They did not work under this 
kind of a contract; and you had the right to be in- 
formed. You were not informed until April 5th. 
And even at that time your man Bray, in his testi- 


290 Glens Falls Indemnity Co. vs. 


mony, says he looked at the records, but he does not 
testify he was informed even at that time that these 
men had been carried on the payrolls. From the 
very beginning, as the bill of particulars shows, 
monies were paid out. Thev did not wait until he 
was in default on the bond, but paid out monies 
from the very beginning. On the basis of that 
argument there was a new relationship. If they 
offer evidence as to how it came about, there still 
remains the question for me to decide, whether that 
alrangement, not having been called to your atten- 
tion, gives any strength to vour argument. I can’t 
decide it now until all the evidence is in. 

Mr. McCall: The evidence we offered came from 
their own witnesses. 

The Court: One side can’t submit a ease; both 
sides must submit the case. Therefore, if you are 
not in a position to make this stipulation the Court 
is not in a position to decide any question of lia- 
bility. 

Mr. Monteleone: I will be willing to stipulate 
that Basich Brothers exercised no control over the 
employee of Duque and Frazzini. 

Mr. McCall: In view of the testimony of Mr. 
Basich and the superintendent, Mr. Kovich—— 

The Court: That is all right. That leaves the 
one other matter. Now, with this particular matter 
undecided, it follows, as a matter of course, if the 
case is reopened it has to be reopened for all pur- 
poses. J am satisfied, gentlemen, from a study of 
the record that this ease should be split up as it is. 
Under the old equity rules it provided that if one 


Basich Brothers Construction Co. 291 


of the issues is such that the decision might decide 
the case, the Court had a right to try just that 
issue, and the determination was designated as a 
final judgment, from which an appeal lay. 

T happened to run into that some years ago, and 
we had a very interesting case, which was not re- 
ported, although this point is not covered because 
everybody agreed that it could be done. That was 
a case where a foreign woman, the Countess of 
Santa Cruz sued her father-in-law for a portion of 
an estate left by some of her husband’s forebears. 
Many questions were involved in that case, and one 
was the question of whether an_ ecclessiastical 
divorce, granted in Spain, had any effect in the 
matter. We decided—I mean, the lawyers for both 
sides and myself decided if the will were inter- 
preted in a certain way the other issues would never 
have to be decided. In other words, if I interpreted 
the will contrary to the contention of the plaintiff 
there would be nothing else to try. So it was agreed 
to submit the matter, I received whatever evidence 
there was, heard arguments, and decided against the 
interpretation of the will which the plaintiff placed 
on it. The case was appealed. I remember one of 
the newer judges on the Circuit asked how it was 
possible to try a case piecemeal. His attention was 
called to the equity rules which allowed this to be 
done. There is only one section in the Rules of 
Civil Procedure which deals with the problem, and 
that is Section 42 (b), which says: 

‘‘The Court in furtherance of convenience or 
to avoid prejudice may order a separate trial 


292 Glens Falls Indemnity Co. vs. 


of any claim, cross-claim, counter-claim, or third 
party claim, or of any separate issue or of any 
number of claims, cross-claims, counter-claims, 
third party claims, or issues.”’ 


i do not know how the Cireuit Court will inter- 
pret this rule; whether they will say that upon such 
trial findings shall be made, and that a judgment 
may be entered, and from that judgment an appeal 
shall he, or whether it shall abide by the entire case. 
Our Circuit Court, for instance, has held that if I 
grant a non-suit upon the ground thai the plaintiff 
has failed to prove a claim, I have to make findings. 
I was the victim of that ruling, so it is very plainly 
impressed upon my memory. So, upon their inter- 
pretation, I do not know whether such a ruling, in 
ease I should rule against hability, could be con- 
sidered final to the extent of warranting the mak- 
ing of findings, and excluding findings as to the 
amount, and sending the case up to the court. That 
is the same reasoning that Judge Harrison ad- 
vanced. 

There’s one other reason why I think that the 
case should be reopened and testimony be received, 
unless you should stipulate as to expenditures made, 
and that, regardless of the question of liability, that 
they were properly made, and that they represent 
the measure of recovery sought in this case. To 
show you why, aside from these questions of law, 
it is impertant that this should be done, I call your 
attention to the fact that under the defenses made, 
the amount of monies paid.out to and for the benefit 


Basich Brothers Construction Co. 293 


of the subcontractor by the contractor is made the 
basis for one of the most strongly argued points of 
the defense, that there was no lability, and that is 
the question of premature payment. It is conceded 
that some $34,000.00 were prematurally paid; that 
is, that the payments exceeded 90 per cent, that at 
least $4,000.00 was paid long before any money was 
even due. 

IT am not deciding that point. I want you to bear 
in mind that I am merely stating some of these 
things because I have not reached a definite conclu- 
sion as to the whole case. I have reached, as any 
student of the law must, certain conclusions as to 
legal principles. I shall refer to one of them in a 
minute, for your own benefit. 

Unless it is stipulated that the amounts paid were 
actually paid on the day they are alleged to have 
been paid, leaving to me to determine whether they 
were properly paid, how can I arrive at any con- 
clusion as to whether they constitute a premature 
payment or not? Of course, if I agreed with Mr. 
Monteleone, that payments made directly to the 
material men and labor men are not within the in- 
hibition of these cases which hold that premature 
payments invalidate the contract—if I agreed with 
him on that I might let it stand. But my conviction 
at the present time is that there is no warrant in 
the law of California or the law of any other state 
for that position. In other words, I take it that 
the law of California specifically says that pre- 
mature payments release the surety, and the best 
statement of this is contained in a ease which is 


294 Glens Falls Indemnity Co. vs. 


commented on by both counsel, and that is the ease 
of Pacific Coast Engineering Co. vs. Detroit Fidelity 
& Surety Co., 214 Cal. 382. Opposing this counsel 
has cited certain cases to the effect that where an 
owner of property, because of mechanic’s liens 
makes direct payments to forestall mechanic’s liens, 
that the doctrine of premature payment does not 
apply. But only one case cited bears such inter- 
pretation, and that is the case of Burr vs. Gardella, 
03 Cal. Ap. 377. But in that case the Court did not 
lay down the rule that premature payments could 
be made. The Court held there that, because the 
contract, which was a public contract, specifically 
provided for the immediate payment of claims for 
labor and materials, that when read together with 
the other conditions of the bond which provided 
only for payment by the contractor, if they were 
not paid, that authorized the making of payments, 
and the Court said that the payments were not pre- 
mature because the obligation to pay immediately 
was just as binding as the other obligation to pay 
when the other had not been paid. In other words, 
they were conflicting clauses, and the Court har- 
monized them in order not to penalize the owner 
who had paid out. Incidentally, that case was de- 
cided in 1921, and the Supreme Court of California 
in Siegel vs. Hechler, 181 Cal. 187, specifically held 
that even where the owner is compelled, in order to 
avoid the hens, to pay money to labor men and 
material men, he cannot recover to the extent of 
the premature payments. 


Bastch Brothers Construction Co. 295 


Mr. Monteleone: If your Honor please, may L 
interrupt—— 

The Court: I am not arguing the case, I am 
merely telling you why I want this information. 
This is not an argument at all. JI am only indicat- 
ing why I believe all these documents will have to 
be set aside and the case set down for trial, for such 
evidence as you gentlemen desire to introduce. 
Otherwise, I am not in a position to decide any 
question in the case. I am indicating to you certain 
of my reactions to the legal principles I have sug- 
gested. Of course, if the case is reopened, and 
additional evidence introduced, you may argue, 
after all the evidence is in, both as to the law and 
as to the facts, without repeating what you have 
already said im the briefs. 

In Siegel v. Hechler, 181 Cal., at 191, it is said, to 
show motivation, even in lien cases, the Courts have 
held that the premature payments exonerated pro 
tanto the surety. Quoting from said case: 

‘‘Under the law as it stood at the times these 
contracts were made and the work done, every 
person furnishing materials or doing work upon 
the building, whether for a subcontractor or for 
the general contractor, was entitled to file a lien 
upon the owner’s property and upon the build- 
ing therefor, at any time within thirty days 
after he had ceased to labor or had ceased to 
furnish materials, and such person could also 
at any time give a stop notice to the owner and 
thereby authorize the owner to withhold from 


96 


Glens Falls Indemnity Co. vs. 


the general contractor upon the principal con- 
tract. It appears from the evidence that the 
bills, aforesaid, were presented to Siegel and 
that the money was then due from Hechler to 
the respective claimants for work done or ma- 
terial furnished and used in the building. The 
answer does not allege, and it is not claimed, 
that the demands thus made upon Siegel were 
not then enable under the law. A stop notice 
could have been given therefor immediately. 
Siegal, therefore, immediately incurred a liabil- 
ity, through this default, to have hens filed on 
the premises for these bills and stop notices 
given therefor to the owner to withhold money 
due to Siegel on the main contract. He was 
liable to be greatly embarrased by these conse- 
quences of such failure on the part of Hechler. 
Such failure was a violation of Hechler’s cov- 
enant to save the general contractor ‘‘free and 
harmless’? from any and all hability which 
might accrue against or upon Siegel as the re- 
sult of any default of Hechler. * * * It was his 
night, if not his duty, to prevent as much of the 
damage’’ as might flow to him. 


The Court then held that the payments there were 
justified under the circumstances, because the hen 
had accrued, the work had been done, and payment 
had been requested of him. But here is the rule 


they state on page 190: 


“Tt is not an accurate statement of the law 
to say that the surety, would be released from 


Basich Brothers Construction Co. 297 


the entire obligation by reason of premature 
payments. They would not be an alteration of 
the contract for the performance of which the 
defendant had become surety. They would be 
a departure therefrom or a violation thereof, 
affected by the parties during its performance, 
without the consent of the surety. The legal 
result of such departures would not be to re- 
lease the surety from the entire obligation. The 
effect would be that Siegel would have no cause 
of action on the bond to recover from the surety 
that part of Hechler’s defaleation that was 
made up of these premature payments.’’ 


So that the entire basis for this distinction is re- 
ferable to the right to file a lien, and to the danger 
to the owner; and the Court, in pursuit of that 
policy, had sought, wherever possible, to justify 
premature payments, and if they are made under 
the mechanic’s lien law they are released pro tanto, 
and if they are made otherwise there is a complete 
relasee, as the other case to which I have referred 
holds. 

Now we are dealing with a contract, on work done 
for the United States Government, on land owned 
by the United States Government. Let me read the 
exact language of the bond: 

“This bond is executed for the purpose of 
complying with the laws of the State of Ari- 
zona, and shall inure to the benefit of any and 
all persons who perform labor of furnish ma- 
terials to be used in, or furnish appliances, 


& 


298 Glens Falis Indemnity Co. vs. 


teams or power contributing to the work de- 
scribed in said contract. so as to give such per- 
sons a right of action to recover upon this bond 
in any suit brought to foreclose the hens pro- 
vided for by the laws of the State of Arizona, 
or In a separate suit brought on this bond.” 


Counsel concedes that is an oversight; that they 
merely used the wrong form. and that no lien law 
of the State of Arizona can apply to work done for 
the Government of the United States. 

Mr. Monteleone: Except under the Miller Act. 

The Court: This is not an action under the Mil- 
ler Act. 

Mr. Monteleone: JI understand: but the prime 
contractor would be liable. 

The Court: I am not talking about what the 
prime contractor would be liable for. if the con- 
tractor were liable over there. This bond. however. 
does not write in anything that the Government 
could do under the other contract. It did not. 
merely because it referred to another contract, of 
necessity give Mr. Basich the same right the Gov- 
ernment has as to him. That does not follow. be- 
cause the Government under its prime contract has 
many rights which Mr. Basich does not reserve to 
him under the contract. 

A contract is the measure of liability. The point 
IT am making is this: This bond is not made to 
cover anv mechanic's lien. Then. assuming that on 
one point the Arizona law applies. and on another, 
the California law applies—because I presume there 
is no Arizona law dealing with this topic—then the 


Basich Brothers Construction Co. 299 


reasoning for the exception to the rule does not 
apply, and if there were premature payments made 
without knowledge, it raises to question of whether 
the yare not either released entirely or released pro 
tanto under the rule of California, I am merely 
propounding questions. That’s why the amounts 
actually paid became important on the question of 
liability. You cannot determine liability without. 
the evidence on that subject being in. 

There is one matter I want to refer to, and as to 
that matter I will state the conclusion I have 
reached, because I feel I should, and it may affect 
counsel’s tactics in the presentation of additional 
evidence; and that is, that this bond is governed by 
the law of California and not by the law of Arizona. 
Ever since Erie v Tompkins was decided we have 
had many difficulties in determining what Jaw 
governs. 

You gentlemen cite the Ostroff case. While the 
Ostroff case was reversed, it was reversed merely 
because a stipulation was entered into that the agent 
called for the payment of premiums in California, 
and the benefits in New York, which would make 
it a New York contract; that the company main- 
tained an office here, at which payments were re- 
ceived, and through which benefits were paid. So 
on the basis of that admission, which appears in 
open court, they held it was a New York contract. 

I would not take judicial notice of the fact that 
agencies were established, and what they did, al- 
though I know I myself pay insurance in that man- 
ner. So it is a common rule of law that a surety 


300 Glens Falls Indemnity Co. vs. 


bond is governed by the law of the state in which 
it is made, unless by the terms of the contract itself 
it is made to comply with another law. If you 
eliminate that section, which provides a compliance 
with the law—becanse it cannot apply to the Gov- 
ernment, because there is no lien against the Gov- 
ernment—then the contract was made here, the 
premium was collected here, and it is performable 
here. And the general rule applying to a surety 
bond is that it is governed by the law of the state, 
and it is performed regardless of what the contract 
maybe. 

it is admitted that the law of California is dif- 
ferent from the law of Arizona in this respect: That 
California law by virtue of the mandate of the 
Legislature, says a contract of surety or guarantee 
shall be interpreted in the same manner as any other 
contract. I think I have given the substance of 
2837 of the Civil Code. If there is a failure to com- 
ply with the condition precedent, or any changes 
which alter the complexion of the contract, there is 
a release of liability. 

Avizona has adopted a distinction based upon a 
premise which is repudiated by our courts, and by 
most of the courts of the states, and by most of the 
writers on the subject, because at the present time 
suretyship is handled by companies organized for 
that purpose, and a different interpretation should 
apply. 

T have read the four cases which have heen cited 
on the subject, and there is only one that really is 
very revealing. The otlfrs merely the general 


Basich Brothers Construction Co. 301 


proposition. The first is Prescott National Bank v. 
Head, decided in 1907, 90 Pac. 328. Then follows 
Laneaster v. Beeker, 224 Pace. 810; New York 
Indemnity Co. v. May, 295 Pae. 314; and the last 
ease cited by counsel Massachusetts Bonding and 
Insurance Company v. Lentz, 9 Pac. 408. 

J have not run down these cases, gentlemen. I 
have contented myself with the cases you have 
eited. Of course, when I study a case, when I make 
notes, I try to supplement the work of counsel, and 
if I find a case is old, { want to make sure it is still 
the law. I have not done it in this case. I think, 
Mr. Monteleone, those are the only cases you have 
cited from Arizona. If there is one more, I have 
probably missed it. 

My. Monteleocne: There was only one ease. I 
think that is very important. 

The Court: In view of the fact that the case is 
going to be reopened for the purpose of showing the 
true relationship between the parties, and answering 
the proposition of what, if any, measure of contr=] 
may have been exercised, it is important to note that 
the Supreme Court of Arizona, in applyimg these 
principles, has insisted that modifications are not 
the basis for exonerating the surety, if they are of 
such character that the court can say that the essen- 
tial features and objects of the original contract 
were maintained. If the changes ave of substance 
even the liberal Arizona law would not release the 
surety, and this for the very obvious reason which 
the court gives in the case referred to, Prescott Na- 
tional Bank v. Head, that even a liberal interpreta- 


302 Glens Falls Indemmuitty Co. vs. 


tion will not be allowed if the changes, in effect, 
make a new contract a substitute for the original 
contract. This is a paragraph, Mr. Monteleone, 
that you referred to several times. I think you 
eite it in full. I will read it. 

‘*Paraphrasing this latter expression of the 
Supreme Court of the United States, we find 
in the case before us that the alteration in the 
manner of fulfilling the construction contract 
did not in effect make a new contract, or make 
a substitute for the original contract; that the 
essential features and the objects of the original 
contract were maintained; that the parties 
without any legal constraint upon themselves 
made modifications in detail, the entire expense 
of which was immediately borne by the obligee 
in the surety contract, did not add to the liabil- 
ity of the sureties on the contractor’s bond and 
did not effect or change the contract price in 
any manner whatever. Therefore, we conclude 
that these departures did not operate to dis- 
charge the sureties.”’ 


In other words, even the Supreme Court of Ari- 
zona, liberal as it is, does not say that you can 
make a change of a substantial nature in the rela- 
tionship of the parties and still hold the surety, who 
has no knowledge of the changes, and was not con- 
sulted before they were agreed to by the parties, 
because I think if that were true the Arizona de- 
cision would lead to an absurdity, and would subject 
to surety company to obligations upon modified con- 


Basich Brothers Construction Co. 303 


ditions which its bond did not underwrite. So that 
even if I adopt the view that this is an Arizona 
contract we still have the problem of whether these 
changes «were substantial or not, because if they 
were, then, of course, the same rule would apply as 
applied if we consider the contract, as I am in- 
clined to at the present time, a California contract 
to be governed by California law. 

Mr. Monteleone: What changes does your Honor 
contend were made in the contract that this contract 
itself does not specify? 

The Court: I am not making findings as to what 
changes were made. I am merely saying that the 
defendants contend that many changes were made. 
The defendants contend they advanced money right 
from the very beginning, before any became due, 
and payments were made direct by the contractor, 
the contractor carrying the employees on their pay- 
rolls subject to their own indemnity, making con- 
tracts for equipment, renting their own equipment, 
and all this changing the entire complexion of the 
entire contract, so that the relationship of con- 
tractor and subcontractor did not exist; and it was 
really that of two persons who, for certain purposes, 
were engaged in a joint venture. 

I am not deciding the case. The only conclusion 
I have reached is that this contract is governed by 
the California law and not the Arizona law. I have 
read all the cases you have cited. I cannot for the 
life of me see that this is an Arizona contract, but 
I say, even if it 1s an Arizona contract, then of 
course the argument is made that there have been 


304 Glens Falls Indemnity Co. vs. 


substantial changes; I am talking about changes; 
Lam not talking about notices; so for that reason 
also the evidence of what was done becomes ma- 
terial; the payments that were made also become 
material, to determine what, if any, changes were 
made in the relationship of the parties. 

One other reason why I think the case should be 
reopened unconditionally is this: In the complaint 
plaintiff alleges that the defendants have been in 
default ever since the beginning, and at all times 
thereafter, I will read the allegation, which is Para- 
erapin X: 

“That said Duque and Frazzini entered upon 
the performance of the requirements of their 
sald subcontract with plaintiff, a copy of which 
is hereto attached and marked ‘Exhibit A’ but 
failed to prosecute said work therein required 
of them continuously with sufficient workmen 
and/or equipment, or to erect two plants each 
capable of producing 800 cubie yards of suitable 
material a day.’’ 


Then you allege they failed to do certain things 
after April 5th. Then in Paragraph XI you allege 
that after they commenced work they failed and 
neglected to pay labor. 

In other words, it is limited to the entire period. 
On the basis of allegation of certain facts in the 
ease the defendants allege that they were in default. 
In your brief you take definitely the position that 
it was no default until there was an abandonment 
of the work; an abandonment on the 8th of June. 

Mr. Monteleone: I don’t think there was a de- 


Bastch Brothers Construction Co. 25) 


fault. I took the position that there were partial 
defaults. 

The Court: You cite the case of Union Sugar 
Company v. Hollister Estate to this effect, but it 
does not alter the position. When the first breach 
occurs it is not the duty of the other side to treat 
the contract as abandoned. He may not do any- 
thing about it, and then rely upon a subsequent 
breach. That is a general proposition of law; and 
in the case you eite, in 38 Cal. 2nd 740, the court 
made that statement merely in order to save the 
claim from the statute of limitation. In other 
words, they said that where several breaches occur 
you are not bound to wait until the first breach. 
You can wait for the next breach and the next one, 
then date your claim, so far as the statute of limita- 
tions 1s coneerned, from the last breach. 

That does not solve the problem here, because 
counsel say that up to April 5th, when you gave 
them the first written notice of any difficulties, that 
several breaches had already occurred, and that you 
had failed to give them notice. Therefore, it be- 
comes very important that all the evidence relating 
to what actually took place, if there is any more 
than is contained in these affidavits of the two men, 
Kovick and Nick Basich, be gone into, and not leave 
anything for further discussion. 

Another thing: The record is not very clear as 
to what actually took place on June 8th. Duque & 
Frazzini have not testified. The testimony is merely 
that they were notified that he was quitting the job, 
and they went on and completed the werk, but not 


306 Glens Falls Indemnity Co. vs. 


until a few days afterward did they notify them, 
and even then it was not a request to do anything, 
but merely a general statement, because, in fact, if 
you were completing the contract on the basis of 
that, it is alleged that you chose to complete the 
contract without giving them the first opportunity ; 
that yon were under obligations to the Government, 
but there was nothing in the contract you have 
which said that you have the right to complete it, 
and the doctrine of minimizing loss does not mean 
completing the work. There is no ease that war- 
rants that. The doctrine of minimizing loss occurs 
mostly in torts. When applied in a contract it 
means merely that a man should protect the prop- 
erty. I have not found any cases you could have 
cited that hold to the extent that minimizing damage 
means that you can walk right in and conclude it. 

The Government can only do certain things. The 
Government cannot command. And because the 
Government had certain rights in the contract with 
3asich, it does not necessarily follow that Basich 
had corresponding rights, unless they were stipu- 
lated in the contract. 

J have tried many of these cases, but I will say 
frankly that the evidence to my mind is very un- 
satisfactory. Another thing is this: When you 
take a case npon the record already made, and no 
other testimony, you deprive yourself, as a judge, 
of the some important safeguard, and that is the 
right to judge the credibility of witnesses, from 
their demeanor on the stand and the manner in 
which they answer certain questions. The Cireuit 


Basich Brothers Construction Co. 307 


Court has said that when a ease is tried upon deposi- 
‘tions solely that they are just as good a judge as I 
am of the inference to be drawn. That is what 
happens in many admiralty cases. If the evidence 
were clear you should not hesitate to take the re- 
sponsibility. But it 1s not clear. 

To sum up, we have three matters: First, here is 
no definite stipulation as to the relationship of the 
defendants’ emplovees to the protective insurances 
which were carried by Basich, other than the gen- 
eral statement that they were carried on the payroll. 
The circumstances relating to the payroll have not 
been gone into, and Mr. Monteleone himself is not 
satisfied with that. If the relationship were that of 
contractor and subcontractor, dealing at arm’s 
length, why didn’t you wait until something became 
due? Why did vou, in advance, pay $4000.00, when, 
according to the engineer, they had no money com- 
ing at all? 

Mr. Monteleone: If your Honor please, the evi- 
dence will explain 


The Court: I am just telling you my views on 
the matter. 

Mr. Monteleone: Did your Honor discuss the 
matter of waiver? We have the question of 
whether or not the surety waived 

Vhe Court: That is a question of fact to be 
determined on the evidence. I am not commenting 
on it, because I do not think that I should express 
any opinion, even if I had reached a definite con- 
clusion on it. I have not reached a definite conclu- 
sion as to whether there was a waiver. Mr. Bray 


306 Glens Falls Indemnity Co. vs. 


until a few days afterward did they notify them, | 
and even then it was not a request to do anything, - 
but merely a general statement, because, in fact, if 
you were completing the contract on the basis of 
that, it is alleged that you chose to complete the 
contract without giving them the first opportunity ;_ 
that you were under obligations to the Government, — 
but there was nothing in the contract you have 
which said that you have the right to complete it, 
and the doctrine of minimizing loss does not mean | 
completing the work. There is no case that war-_ 
rants that. The doctrine of minimizing loss occurs 
mostly in torts. When applied in a contract it 
means merely that a man should protect the prop- 
erty. I have not found any cases you could have 
cited that hold to the extent that minimizing damage 
means that you can walk right in and conelude it. 

The Government can only do certain things. ‘The 
Government cannot command. And because the 
Government had certain rights in the contract with 
Basich, it does not necessarily follow that Basich 
had corresponding rights, unless they were stipu- 
lated in the contract. 

I have tried many of these cases, but I will say 
frankly that the evidence to my mind is very un- 
satisfactory. Another thing is this: When you 
take a case upon the record already made, and no 
other testimony, you deprive yourself, as a judge, 
of the some important safeguard, and that is the 
right to judge the credibility of witnesses, from 
their demeanor on the stand and the manner in 
which they answer certain questions. The Circuit 


Basich Brothers Construction Co. 307 


Court has said that when a ease is tried upon deposi- 
tions solely that they are just as good a judge as I 
am of the inference to be drawn. “That is what 
happens in many admiralty cases. If the evidence 
were clear you should not hesitate to take the re- 
sponsibility. But it is not clear. 

To sum up, we have three matters: First, here is 
no definite stipulation as to the relationship of the 
defendants’ emplovees to the protective insurances 
which were carried by Basich, other than the gen- 
eral statement that they were carried on the payroll. 
The circumstances relating to the payroll have not 
been gone into, and Mr. Monteleone himself is not 
satisfied with that. If the relationship were that of 
contractor and subcontractor, dealing at arm’s 
length, why didn’t you wait until something became 
due? Why did vou, in advance, pay $4000.00, when, 
according to the engineer, they had no money com- 
ing at all? 

Mr. Monteleone: If your Honor please, the evi- 
dence will explain 


The Court: I am just telling you my views on 
the matter. 

Mr. Monteleone: Did your Honor discuss the 
matter of waiver? We have the question of 
whether or not the surety waived 

The Court: That is a question of fact to be 
determined on the evidence. I am not commenting 
on it, because I do not think that I should express 
any opinion, even if I had reached a definite con- 
clusion on it. I have not reached a definite conclu- 
sion as to whether there was a waiver. Mr. Bray 


308 Glens Falls Indemnity Co. vs. 


was merely an investigator. He was not an officer; 
he was not a person who entered into the contract, 
or modified the contract. He merely was somebody 
who went there to see something and report; so 
that is all the evidence there is upon which an 
alleged waiver is based. 

You gentlemen have lived with this case for a 
long time, while I have had four or five days to 
work on it. It is a very difficult record. You have 
briefed it very thoroughly, on both sides. The 
briefs were started in such a manner that mstead 
of three vou have four briefs. So it is a strenuous 
job on the part of the judge to go over a record 
like this and form a conception of the case. I am 
giving you my reactions merely to indicate why I 
believe that the submission should be set aside, and 
the case set down for trial. And when it is tried 
that the whole matter be gone into, sc when it is 
submitted you will have a record with no reserva- 
tions, which you do not have at the present time, 
even on the question of lability. 

One thing is to be borne in mind, that in what 
I have said I am not to be understood as indicating 
any definite opinion as to the case. I have merely 
indicated one definite opinion as to the law, which 
T have a right to do, having studied all the law that 
has been offered on the subject. I have also indi- 
cated why certain problems which have been raised 
have given rise to certain difficulties which I think 
can only be overcome if the case is reopened and 
set down for a definite trial; then resubmitted, with 
such additional oral argument as I shall designate. 


Basich Brothers Construction Co. 309 


You can see why it is always best to have oral argu- 
ment, because an oral argument brings things out 
Which a brief can never bring out. So I will allow 
an oral argument later on. Had I known what was 
going to happen last week, and had I reached the 
conclusion that the case should be reopened, I could 
have had you come up last week, and have taken 
two or three days to finish this additional testimony. 
But it is hard to tell. when a case begins, how long 
it is going to last. We had a case which counsel 
were certain would take three days at least. It tock 
just exactly one day, because we limited the issues 
in the morning session, and the limitation of testi- 
mony resulted in a shorter case, and the case was 
concluded at five o’clock that afternoon. 

J am making this explanation, because when [ 
took the case I understood it was an urgent matter. 
That was the reason I took it over from Judge Hail. 
My calendar is in very good shape, but [ am leaving 
this week-end to go to San Diego, and shall be there 
holding court for three weeks. I cannot therefore 
give you a date. I probably might have given vou 
a date at the time the case was submitted, but I 
thought, as Judge Hall thought, that the matter 
could be decided on the record, and I did not reach 
the conclusion really until I called you and even 
then some of the things I call to your attention 
now were not included in the object of my eall. As 
a matter of fact, the only matter I was going to 
bring out, had you come here Wednesday or Thurs- 
day, being in the midst of a trial, would have taken 
only a few minutes. I intended merely to indicate 


310 Glens Falls Indemnity Co. vs. 


to vou that I thought an accounting should be gone 
into, but the other matters, the deficiencies in the 
evidence, I did not know about. I had not gone that 
far, and had not read all the depositions. 

Mr. Monteleone: Your Honor enumerated what 
you wanted, and started with No. 1. I do not know 
whether you intended to continue. 

The Court: I merely have a note to follow. In 
the first place, on the matter of depositions to be 
put in, unless you stipulate as to the expenditures 
and the manner of their making, the entire bill of 
particulars should be gone into. And, if you are 
unable to stipulate as to the payroll, the insurance 
and the like, so far as they bear on the control, those 
matters will have to be gone into. 

Then, as I said, the additional testimony should 
be brought in to clarify what exactly took place on 
June 8th. At the present time I believe the testi- 
mony is rather unsatisfactory, and as I now take 
the view, that that was the latter breach, and was 
not an abandonment, I feel that should be added. 

1 have spoken to you because some of these things 
arise from your side. I spoke just as much to Mr. 
McCall, because he might want, in view of the 
statement I have made, to bring in other testimony. 
to produce the members of the firm, or any one 
representing the subcontractor, to give their version 
of what took place. He is arguing they prevented 
him from carrying on, and the evidence, to my 
mind, is not sufficient to warrant findings one way 
or the other. It is unsatisfactory. If, after you 
consider the matter, you desire, without repeating 


Basich Brothers Construction Co. one 


what you have in the depositions, to bring back 
some of the same witnesses for either further ex- 
amination or cross-examination, it can be done. 

Mr. Monteleone: What date will vour Honor 
have? 

The Court: Gentlemen, I have been setting 
cases ahead of this case, and I have made other 
arrangements about San Diego. Although it is not 
my turn there I am merely going down to help out 
with the calendar. This month is taken up. and 
January, with the holidays coming in, I have eases 
as late as January 21st. I can give you January 
28th. 

Mr. Monteleone: I have a jury trial, which has 
been continued twice, if your Honor please, set for 
January 30, and this may take several days. I was 
wondering if a few days after the 30th. 

The Court: I have no objection. If you want, 
I will give you a clear week beginning February 4th. 

The submission is vacated, and the cause is se 
for Tuesday, February 4th, for hearing along the 
lines indicated by the court in its statement, for 
the completion of the trial. 

Mr. McCall: All the records now in will stand 
as they are? 

The Court: Yes, all the depositions ave in, and 
all the exhibits are in. The purpose of reopening 
is merely for additional testimony along the lines 
indicated. 


ol2 Glens Falls Indemnity Co. vs. 
CERTIFICATE 


I hereby certify that I am a duly appointed, 
qualified and acting official court reporter of the 
United States District Court for the Southern Dis- 
trict of California. 


I further certify that the foregoing is a true and 
correct transcript of the proceedings had in the 
above entitled cause on the date or dates specified 
therein, and that said transcript is a true and cor- 
rect transcription of my stenographic notes. 


Dated at Los Angeles, California, this 2nd day 
of January, A. D. 1947. 


/s/ HENRY A. DEWING, 
Official Reporter. 


[Endorsed]: Filed May 16, 1947. 


[Title of District Court and Cause. ] 


Before: Honorable Leon R. Yankwich, 
Judge Presiding 


REPORTER’S TRANSCRIPT OF 
PROCEEDINGS 


Los Angeles, California 
February 4, 1947, 10:00 a.m. 


Mr. Monteleone: Your Honor, since we had our 
discussion before the court on the last occasion I 
proceeded to take the deposition of Carson Fraz- 
zini at Reno, Nevada. Mr. McCall was present and 
I was present, and at this time, if there is no ob- 


Basich Brothers Construction Co. 313 


jection on the part of the defendant, the plaintiff 
will offer in evidence this deposition of Carson 
Frazzini, who happens to be a member of Duque & 
Frazzini, subcontractors. 

Mr. McCall: No objection. 

The Clerk: How will I mark this? 

The Court: As an exhibit. 

The Clerk: Does anybody have the number to 
be given to it? 

Mr. McCall: Yes, I have it. The last exhibit 
for the plaintiff was No. 23. 

The Clerk: This will be Plaintiff’s Exhibit 24. 

Mr. Monteleone: In reading over the deposition, 
if your Honor please, I notice the reporter undoubt- 
edly made a clerical error. I would like to call the 
same to the court’s attention, and probably Mr. 
McCall will not object to the correction thereof. 
On page 27, line 26, and page 49, line 5, imstead 
of ‘‘ Basich”’ the name was ‘‘Bray.’’ Is that correct, 
Mr. McCall? 

mie Me@all: Mes, that is correct: 

The Court: Where it says Mr. Basich you 
meant Mr. Bray? 

Mr. Monteleone: Yes. On page 58, line 12, it 
should be ‘‘Up to the time you moved your plant 
away’’ and on the line following instead of ‘‘hen’’ 
is Should be ‘‘men.”’ 

MevCourr: Alliwight 

Mr. Monteleone: On page 76, line 5, the objec- 
tion by Mr. McCall, which reads: ‘‘May it be under- 
stood that we object to all of this deposition, which 
I understand does pertain,’’ instead of that it 


O14 Glens Falls Indemnity Co. vs. 


should have read ‘‘does not pertain.’’ Is that cor- 
rect, Mr. McCall? 

Mr. McCall: That’s right. 

Mr. Monteleone: The word ‘‘not’’ should be 
added after ‘‘does.”’ 

The Court: All right. 

Mr. Monteleone: And on page 78, line 9, it 
should read ‘‘Did he ever give any such orders that 
you know of ?”’ instead of ‘‘Did you ever give any 
such orders that you know of?’’ Is that correct, 
Mr. McCall? 

Mr. McCall: Apparently. 

Mr. Monteleone: And on page 96, line 12, it 
reads ‘“‘E. E. Bressi and B. E. Varda.’’ It should 
be ‘‘Bressi and Bevarda.”’ 

In connection with the bill of particulars, that 
had been filed by the plaintiff, and the amendment 
thereto, in reference to the insurance, in checking 
over some of the exceptions filed by Mr. McCall we 
had our auditor recheck, and we find a few more 
errors, which I will ask the court at this time to 
credit. Schedule I, page 96. 

Mr. McCall: Does the court have before him 
this document I filed with the clerk? 

The Court: Yes, I have a copy. 

Mr. Monteleone: Schedule I, if the court please, 
page 96, there is an item listed, Leslie McDaniel, 
$6.00, which is a duplication, and should be elimi- 
nated. 

Mr. McCall: May I ask if counsel has the page 
of the exceptions to the bill of particulars, on which 
that appears? 


Basich Brothers Construction Co. 305 


Mr. Monteleone: No; I. am just making my own 
corrections, Mr. McCall. 

The Court: That is the last item? 

Mr. Monteleone: Yes. On page 97, Rex McCoy, 
Maintainer Operator, that is a duplication, $33.75, 
so that item should be eliminated, so that instead 
of the total amount as shown on page 2 of the Bill 
of Particulars, Schedule I, being $38,979.65, it 
should be $38,939.90. 

The Court: All right. 

Mr. Monteleone: On Schedule II, page 23, Man- 
uel Billareal, there is an error in that amount in 
the sum of $6.12. Instead of the total being $55.56, 
it should be $49.44. 

On page 2, where the total is shown in Schedule 
IT, instead of being $8,240.54, it should be corrected 
to read $8,234.42. 

Schedule IV, page 8, there is an error of an 
overcharge of $26.81, which should be deducted 
from $44.69, leaving a balance of $17.88. 

Schedule X, page 1, lines 27 and 28 of that page, 
if your Honor pleases, there are two items, each 
referring to Dozer 428, showing a total amount of 
1214 hours. That should be corrected to 1014 for 
the total, thereby eliminating from that total the 
sui of $20.40. 

The Court: Which item is it? 

Mr. Monteleone: Dozer 428, lines 27 and 28; 
the total of those two items is $124.90, consisting 
of $75.00 and $45.90. Instead of that, the total 
should be $104.50. Instead of working 8 hours and 


316 Glens Falls Indemnity Co. vs. 


414, hours, apparently they worked 8 hours and 214 
hours, or 1044 hours. 

On Schedule XIX, page 1, Shovel 108, there is 
an overcharge. What is the date of that over- 
charge? 

Mr. McCall: That is on page 32 of my memo, 
but I do not have the date. 

Mr. Monteleone: ‘There is a duplication, if the 
court please. 

The Court: $129.04. 

Mr. Monteleone: Yes, there is an overcharge of 
$26.81. 

The Court: Why do you want to make the 
change? 

Mr. Monteleone: It was an overcharge. 

Mr. McCall: The date is June 9, 1945. 

My. Monteleone: Thank you, Mr. MeCall. 

Schedule X XI, page 1, in checking over the fig- 
ures throughout, this corresponds with the check 
made by the defendant. If the court please, there 
is an overcharge of $352.47, so that Schedule X XI, 
in the front should read $27,477.07 instead of 
$27,809.54. 

There is one question, if the court please, we 
ask to make in connection with the amended bill 
of particulars, covering the items of insurance. That 
is Schedule VI, as amended. It shows a total amount 
of public liability and property damage in the sum 
of $611.09. 

The Court: What schedule is that? 

Mr. Monteleone: V1, as amended. There was an 
amendment filed at your Honor’s suggestion, which 


Basich Brothers Construction Co. ony 


segregated the various items of imsurance. From 
February 17, 1945, to June 9, 1945, totaling $476.26, 
charged in connection with public lability and 
property damage. That amount should be elimi- 
nated, and the total in property damage and public 
liability should be $134.83 instead of $611.09, as 
appears on the second page of this amendment. 

Mr. McCall: It is dated August 18. 

Mr. Monteleone: All items from February 17, 
1945, to June 1, 1945, under public liability and 
property damage, total $476.26 should be eliminated, 
as the policy shows these parties were not covered 
by public liability. $611.09 should be changed to 
$134.83. 

Those are the only changes we ask the court to 
make at this time. Mr. Popovich, will you take the 
stand ? 


GEORGE J. POPOVICH 
ealled as a witness by and on behalf of the plaintiff, 
having been first duly sworn, was examined and 
testified as follows: 


The Clerk: What is your name, please? 
A. George J. Popvich. 


Direct Examination 
By My. Monteleone: 
Mr. Popovich, your full name is what? 
George Jovan Popovich. 
What is your business or occupation ? 
Contractor. 


POP 


318 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. With Basich Brothers Construction Com- 
pany, the plaintiff in this matter? A. Yes. 

Q. What is your official capacity ? 

A. Secretary and office manager. 

Q. And the office is located where? 

A. 600 South Fremont Avenue, Alhambra. 

Q. Were you occupying the same position dur- 
ing the year 1945? A. Yes. 

Q. What has been your experience in connec- 
tion with construction work ? 

A. I have been engaged in construction work 
for approximately 11 years. 

Q. Did you have any experience as an account- 
ant also? 

A. Yes, I have had experience as an accountant, 
and I also passed the Certified Public Accountant’s 
examination in the State of California. 

Q. Have you had duties with other contractors 
in connection with work of a kind similar to the 
work involved in this action? A. Yes, sir. 

Q. Did you have occasion to meet a member of 
the firm of Duque & Frazzini? A,” Yes 

Q. When did you first meet, and who did you 
first meet of this firm? 

A. Mr. Frazzini, when we commenced to nego- 
tiate on our contract. 

Q. Can you give us approximately when that 
was? A. J would have to refer 

@. The contract is dated February 7, 1945? 

A. On or about February, 6th. 


Basich Brothers Construction Co. 319 


(Testimony of George J. Popovich.) 

Q. Had you known either Duque or Frazzini 
prior to that time? A. No. 

Q. To your knowledge had Duque and Frazzini 
done any work for Basich Brothers prior to that 
time? A. No. 

Q. Did you discuss the terms of the contract 
which was to be drawn? A. Yes. 

Q. Had you heard from Duque & Frazzini prior 
to the time the contract was drawn, either by tele- 
phone or wire? A. Yes. 

Q. How did they contact you? 

A. They first called by telephone, and I referred 
them to Mr. Nick Basich. Then we received several 
telegrams. 

@. After that they came to your office, is that 
correct ? Ney Y eS, 

Q. While Mr. Frazzini was at your office, before 
the contract was prepared, did you have any dis- 
eussion with Mr. Frazzini in reference to a bond ? 

A. Yes, I asked him whether or not he was 
financially capable. He said he was. I asked him 
for the name of his bonding company. He gave me 
the name, and said to call the bonding company on 
the phone, which we did. 

What name did he give? 

Glens Falls Indemnity Company. 

That was before the contract was signed ? 
Yes. 

. Did you have a conversation with the Glens 
Falls Indemnity Company at that time? 

Yes, we talked to them on the phone, and 


Oropre 


- 


220 Glens Falls Indemmty Co. vs. 


(Testimony of George J. Popovich.) 

Mr. Frazzini talked to them on the phone. We 
were told they were financially capable, and a bond 
would be written in their San Francisco office. 

Q. Who told you that? 

A. I don’t know the name of the individual. 

Q. Someone at the Glens Fails, Los Angeles? 

A. Yes. 

Q. Was anythmg said as to who was to pay the 
premium on the bond? 

A. Yes, Mr. Frazzini insisted, since we were 
insisting on a bond we would have to pay the pre- 
miums, which we agreed to do. 

Q. Did he talk to them, or to a representative, 
on the telephone? 

A. Yes, because they sent an invoice to us from 
San Irancisco for the premium on the bond. 

Q. Was a discussion had with Mr. Frazzini at 
that time with reference to the payroll to be made 
by Duque & Frazzini in connection with the sub- 
contract, if one was signed at that time? 

A. Yes. 

Q. What was said? 

A. Myr. Frazzini told us that he had started 
work at the time, and had worked in Nevada. He 
was unable to take care of the payrolls because of 
his money being tied up. He insisted on us carrying 
the payroll, and paying’ all of the insurance. That 
was incorporated in a special provision. Mr. Fraz- 
zini stated insofar as all of the bills were concerned, 
he was able to meet them. 


Basich Brothers Construction Co. 22 


(Testimony of George J. Popovich.) 

Q. That was the reason that provision was put 
in your contract ? A. Yes. 

Q. You drew the contract, did you not? 

A. Yes. 

Q. Do you know yourself when Duque & Fraz- 
zini first started operations ? 

A. I don’t know. 

@. After the contract was signed, the subcon- 
tract, which is introduced in evidence as Plaintiff’s 
Exhibit 1, dated February 7, 1945, was the original 
of that agreement given to Mr. Frazzini after it 


was signed ? A. Yes. 
Q. As I understand, you prepared the subcon- 
tract yourself? A. Yes. 


Q. Did you arrange any system of keeping ac- 
count of any of the expenses or any moneys paid 
out in connection with the transaction between the 
Basich Brothers Construction Company and Duque 
& Frazzini, while they were operating ? 

A. Yes. 

Q. Will you state what was the system which 
you adopted in connection with keeping the account 
and records for that purpose? 

A. In reference to the payrolls, Duque & Fraz- 
zini submitted weekly payrolls. We took the weekly 
payrolls and paid the employees. We also kept 
separate records pertaining to supplies, consisting 
of parts and miscellaneous express charges. Those 
were kept separate in our journal books and those 
were charged to Duque & Frazzini as accounts re- 
ceivable. We also kept memorandum records show- 


a2 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

ing the time the equipment was sent over to Duque 
& Frazzini’s work and the time they were released 
by Duque & Frazzini to us. 

Q. Those were records kept in the ordinary 
course of business ? Aa Mies 

Q. In that system you adopted the system 
usually adopted by contractors in work of that 
kind? AGeaaes. 

@. In reference to the progress of the work by 
Duque & Fvazzini, were any payments made by 
Basich Brothers directly to Duque & Frazzini dur- 
ing their entire operation? A. No, 

Q. Aside from paying the payroll and the in- 
surance, as stated in your contract, were there any 
payments made direct to Duque & Frazzini instead 
of having the same charged as a charge against 
Duque & Frazzini? A. I don’t understand. 

Mr. Monteleone: Will you read the question? 

(Question read by the reporter.) 


Mr. Monteleone: I will ask to strike the 
question. 

@. I notice in the bill of particulars there are 
certain charges for the rent of equipment from 
Basich Brothers to Duque & Frazzini? 

A. Yes. 

Q. Were those merely charges against them for 
equipment furnished ? A 6“That’s richie 

Q. The same also as to supplies furnished them ? 

A. Yes. 

Q. Did you arrange for workmen’s compensa- 


Bastch Brothers Construction Co. a8 


(Testimony of George J. Popovich.) 
tion in connection with the Duque & Frazzini work ? 

A. Yes. 

Q. Referring to your bill of particulars, Mr. 
Popovich, which was introduced in evidence, Sched- 
ule I, Payroli—Duque & Frazzini, from February 
11, 1945, to June 9, 1945, showing a total of 
$38,979.65, subject to the correction made this 
morning, will you state from what data or infor- 
mation that item was prepared ? 

A. The items were prepared from weekly pay- 
rolls submitted by Duque & Frazzini. 

Mr. McCall: That is objected to, as the payrolls 
themselves would be the best evidence. 

The Court: In the Federal Court, if the payrolls 
are available, a person who had charge of them can 
summarize. 

Mr. Monteleone: We have the originals; if Mr. 
McCall desires the originals, they are in court. 

The Court: So long as the originals are avail- 
able for inspection, it is not necessary to produce 
them. 

Mr. Monteleone: They have been inspected by 
the auditor for the defendant on many occasions. 

The Court: I will allow you then to refer to 
this as a summary, it being understood that the 
originals are present and available to counsel. That 
is the Federal rule, and has been for many years. 

Q. (By Mr. Monteleone): Were those weekly 
payrolls kept in the ordinary course of your busi- 
ness ? A. Yes. 

Q. Were the entries under Schedule I prepared 


B24 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

by you from original weekly payrolls of Duque & 
Frazzini? 

You have reference to Schedule I? 

I am referring to Schedule I. 

This was compiled by Homer Thompson. 
Was it under your supervision ? 

It was under my supervision. 


QPrOPO & 


Botn of you checked the payroll when you 
prepared the Bill of Particulars? A. Mes 

Q. With respect to the corrections that were 
made by me this morning, can you state whether 
or not Sckedwe I of the Bill of Particulars cor- 
rectly sets forth each and every item as therein 
specified, as you incorporated the same from the 
weekly payroll furnished you by Duque & Frazzini? 

A. Yes. 

Q. Referring to Schedule II, Payroll, Pioneer 
Crusher Plant, March 25, 1945, to June 9, 1945, 
amount $8,240.54, subject to any corrections that 
may have been made this morning by myself, will 
you state to the court from what data or records 
did you take the items set forth in this particular 
schedule ? 

A. They were taken from time cards signed by 
the employee and approved by Duque & Frazzini’s 
foreman. 

Q. Were those time cards kept in the ordinary 
course of business? A. Yes. 

®. Do the items set forth in Schedule II of 
the Bill of Particulars correctly set forth all of 
the items as set forth in the time card? 

A. Yes. 


Basich Brothers Construction Co. $25 


(Testimony of George J. Popovich.) 

Q. In reference to Payroll, Pioneer Crusher, 
June 9, 1945, to September 22, 1945, which is under 
the heading Schedule ILT of your Bill of Particu- 
lars, will you state from what data or records those 
items were taken? 

A. Daily time cards. 

@. And those were time cards made by whom? 

A. By the employees and signed by the foreman. 

Q. Were they made regularly, every day, in 
the ordinary course of business? 

A. I wasn’t on the job at the time that hap- 
pened. Homer Thompson was office manager. 

@. From your inspection of the daily time cards 
that purported to be daily time cards, were they 
kept in the ordinary course of business? 

A. Yes, they were. 

Q. Considering any exceptions which I may have 
referred to, which I don’t believe I did in this 
particular matter, this morning, can you state 
whether or not the items set forth in Schedule IIT 
of the Bill of Particulars correctly sets forth each 
and every item under Payroll, Pioneer Crusher, 
during the time as indicated, which you had taken 
from the daily payroll records? A. Yes. 

Q. In reference to Schedule [V, P.D.O.C. 
Crusher, June 3, 1945, to July 7, 1945, in the sum 
of $3,250.01, will you state from what records you 
arrived at the amount of $3,250.01? 

A. From the dailv time cards. 

@. From the daily time cards prepared by 
whom ? 


326 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. ‘The employees and signed by the foreman. 

Q. They were turned in to your office after 
that, is that correct? A. Yes. 

Q. These time cards were prepared in the ordi- 
nary course of business? A. Yes. 

Q. In preparing Schedule IV of your Bill of 
Particulars, from these daily time cards, does the 
Bill of Particulars correctly set forth the items as 
contained in the daily time cards? A. Yes. 

Q. Referring to Schedule V Payroll, Hot 
Plant—Sand, June 9, 1945, to September 22, 1945, 
in the sum of $2,888.92, from what records did you 
arrive at that amount? 

A. Daily time cards. 

Q. Kept by whom? 

A. The emplovees, and signed by the foreman. 

Q. Does your Schedule V of your Bill of Par- 
ticulars correctly set forth all of the items as you 
had taken them from the daily time cards? 

He) NEC, 

Q. Will vou explain what was the use of that 
hot plant at that particular time? 

A. Yes, the purpose of the hot plant was to 
drv out the sand material used in connection with 
aggregate materials. 

Q. Was that sand specified in the subcontract 
with Duque & Frazzini? A. Yes. 

Q. In connection with Schedule VI, Insurance 
Compensation, $5,893.60, will you state how that 
amount was arrived at? 


Bastch Brothers Construction Co. BOT 


(Testimony of George J. Popovich.) 

A. That was arrived from payments made to the 
Arizona Industrial Accident Commission, and 
amounts paid to the Pacific Indemnity Company, 
and amounts paid to the Arizona Unemployment 
Commission, and amounts paid to the Federal Gov- 
ernment for Old Age and Excise Tax. 

Q. Taking the compensation, were those figures 
checked by any representative of the Arizona Com- 
pensation Insurance Company ? 

A. Yes, Mr. Hutchison, the auditor. 

Q. Can you state how the rates were determined ? 

A. The original classification 5506 was sub- 
mitted to Duque & Frazzini for observation, and 
later was changed to classification 1710, because of 
an error made by the Arizona Insurance Com- 
mission. 

Q Is this compensation, workmen’s compensa- 
tion, as set forth in the schedule, confined exelu- 
sively to the operation of the work called for under 
the subcontract of Duque & Frazzini? 

me Yes. 

Q. Would you state the same thing was true 
with the other items of insurance? A. Yes. 

@. From the records vou have, would you state 
that the Bill of Particulars, Schedule VI, correctly 
sets forth the exact item in reference to each of 
these matters? A. Yes. 

Q. Were the amounts actually paid bv Basich 
Brothers Construction Company on account of the 
various insuranee therein specified ? A. Yes, 

Q. You have Schedule VII, Equipment Rental, 
fully operated, Basich Brothers Construction Co., 


328 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

February 12, 1945, to May 19, 1945, $3,989.41. What 
is understood in the construction business by 
“Equipment Fully Operated’? when you speak of 
rental? 

A. We speak of rental equipment being fully 
operated—the contractor must take care of all the 
labor, fuel, maintenance, and everything else that 
is necessary to operate the machine to work con- 
tinuously. 

Q. Do vou mean the contractor, or the one 
who owned the equipment? 

A. The one that owned the equipment. 

Q. So you want to correet your statement? 

A. Yes, the one who owned the equipment. 

Q. The basis of rental is fixed on what? 

A. Hourly basis, in accordance with the O.P.A. 
regulation. 

Q. In connection with Schedule VII, total 
€3,989.41, where did you get those figures? 

A. From the equipment time cards. 

Q. Will you state what kind of time cards were 
prepared, by whom they were prepared, and what 
did they show? 

A. Yes, each employee operating a piece of 
equipment prepared a time card, showing the classi- 
fication and type of work being prepared. It was 
properly signed by him, and also signed by the 
foreman. 

Q. The Schedule VII of vour Bill of Partieu- 
lars correctly sets forth the amount as set forth 


Basich Brothers Construction Co. 329 


(Testimony of George J. Popovich.) 
in your time cards, to which you have just referred ? 

A. Yes. 

Q. Was this equipment used solely in connec- 
tion with the work of Duque & Frazzini? 

A. Yes. 

Mr. McCall: I object to that as calling for a 
conclusion. 

Q. (By Mr. Monteleone): So far as your rec- 
ords show? A. Yes. 

Q. Did you have anything to do with Duque & 
Frazzini in connection with the rental of this 
equipment referred to in Schedule VII, you your- 
self ? A. Not under this schedule. 

Q. Upon what was the amount of rental based 
under Schedule VII? What is the basis of it? 

A. It is on O.P.A. rental rates. 

Q. In connection with Schedule VIII, Equip- 
ment Rental not Fully Operated, Basich Brothers 
Construction Co., March 29, 1945, to June 9, 1945, 
$2,.773.86—what is commonly understood in the 
construction business when you speak of rental of 
equipment not fully operated? 

A. The individual renting the equipment must 
maintain it and furnish all labor and fuel in con- 
nection with the cperation of the equipment. 

Q. If any parts are to be replaced, is that by 
the party who rents the equipment? 

A. Yes, that is, if they are not of a maior 
nature. 

Q. How about replacement? 

A. Yes, that is to be paid. 


330 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. This equipment not fully operated, rented to 
Duque & Frazzini, and was it used exclusively in 
connection with Duque & Frazzini’s operations? 

A. Yes. 

Q. From what records did you arrive at the 
amount of $2,773.86? 

A. From the time card records, equipment rec- 
ords and memorandums made in books of original 
entry. 

@. Were those records kept in the ordinary 
course of your business? A. Yes. 

@. From those records does the amount that you 
indicate in Schedule VIII of your Bill of Particu- 
lars correctly set forth the amount of $2,773.86? 

A. Yes. 

@. And upon what was the rental amount 
charged to Duque & Frazzini based? 

A. On O.P.A. rental rates. 

Q. In connection with your Schedules VII and 
VIII, rent of equipment fully operated, and rent 
of equipment not fully operated, those were equip- 
ments that were owned by Basich Brothers, is that 
correct ? A. Yes. 

Q. They were rented by Duque & Frazzini, is 
that correct ? A. Yes. 

@. And on your books you made a charge against 
Duque & Frazzini for rental, is that correct? 

A. Yes. 

Q@. You have Schedule IX, Equipment Rental 
Royalty Basis, Basich Brothers Construction Co., 


Basich Brothers Construction Co. 331 


(Testimony of George J. Popovich.) 
$4,191.60. What do you mean by rental, royalty 
basis ? 

A. The amount to be paid depends entirely on 
the amount of materials produced through the 
plant. 

Q. Was this equipment rented fully operated 
or not? 

A. No, it was not rented fully operated. 

Q@. Upon what record did you arrive at the 
figure on Schedule TX, $4,191.60? 

A. From books of original entry, engineers’ 
estimates and engineering figures. 

Q. Those estimates were made in the regular 
course of business ? A. Yes. 

Q. Does the amount, $4,191.60, set forth cor- 
rectly the amount shown in those records? 

A. Yes. 

Q. Was this rental equipment used exclusively 
in connection with Duque & Frazzini’s operations? 

A. Yes. 

Q@. Upon what rental basis did you arrive at 
the amount? 

A. The basis submitted by N. L. Basich to him. 

Q. To who? A. Mr. Frazzini. 

@. What was that basis? 

A. 10 cents per cubic ton for the Pioneer 
crusher. 

Q. You mean 10 cents per ton? A. Yes. 

@. In your opinion as a contractor, was that 
amount a reasonable charge? 

A. Approximately 50 per cent less than the 
O.P.A. rental. 


332 Glens Falls Indemmty Co. vs. 


(Testimony of George J. Popovich.) 

Q. In other words, you charged about 50 per 
cent less than the O.P.A. rates? 

A. Yes. 

Q. In your opinion that would be a reasonable 
charge? Duy. eS: 

Q. Was this used solely in connection with the 
operations of Duque & Frazzini? A. Yes. 

Q. Would you state that the charges in Schedule 
No. VIT and VIII of your Bill of Particulars were 
reasonable charges? aA. <@NIES: 

Q. In connection with Schedule X, Equipment 
Rental Fully Operated, P.D.O.C., February 12, 
1945, to May 19, 1945, $6,902.87; Not Fully Oper- 
ated, May 9, 1945, to June 10, 1945, $261.34; upon 
what were those figures based ? 

A. They were based on O.P.A. rental rates. 

@. Were these equipments used exclusively in 
connection with Duque & Frazzini’s operations? 

A. Yes. 

@. It says that the equipment was fully oper- 
ated, P.D.O.C. What do you mean by that? 

A. P.D.O.C. was the name of a contracting com- 
pany in Tueson, Arizona. 

@. Did they own the equipment? 

A. I would not know. 

@. Did you acquire the equipment from them? 

A. J would not know that. They had the equip- 
ment. We did not know whether they were the legal 
owners. 

@. How did it happen that you carried that 
account on your books? Did you make arrange- 
ments with Duque & Frazzini? How did you happen 


Basich Brothers Construction Co. ooo 


(Testimony of George J. Popovich.) 

to show the equipment charged against Duque & 
Frazzinin directly by Basich Brothers rather than 
ee Occ 

A. That was taken care of by Mr. N. L. Basich. 

Q. From what records did you determine the 
amount of $6,902.37 for the equipment fully oper- 
ated, in Schedule X ? 

A. From invoices submitted by P.D.O.C., daily 
time cards, with the proper approval by the 
foreman. 

@. The account in your schedule correctly sets 
forth the charges made by P.D.O.C. for fully oper- 
ated rental, and also for not fully operated rental, 
as snown by your records? 

A. Yes. I would lke to make a _ statement. 
N. L. Basich, he took care of some of this, but not 
all of it. That is, our superintendents on the job, 
that is, Duque & Frazzini’s foremen arranged for 
some of this equipment owned by P.D.O.C. 

Q. If Duque & Frazzini wanted a piece of 
equipment, they asked you folks to get it for them? 

A. Yes. 

@. And then you turned the equipment over to 
Duque & Frazzini? A. Yes. 

Q. The owners would bill you? 

eis) right, 

Q. You would then charge the same against 
Duque & Frazzini? A. Yes. 

Q. Upon what were the rentals in Schedule X 
based? A. O.P.A. rental rate. 

Q. In vour opinion, were those charges reason- 
able charges? A. Yes. 


334 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q@. Did you make any greater charges to Duque 
& Frazzinin for the rental of these items than were 
made to you by P.D.O.C. A. No 

Q. Were these equipments used exclusively in 
connection with Duque & Frazzini operation? 

A. Yes. 

Q. In connection with Schedule XI, Equipment 
Rental Fully Operated by Basich Brothers, J. G. 
North & Sons, February 21, 1945, to June 6, 1945, 
#4,956.06—upon what records did you arrive at the 
amounts set forth in Schedule TX? 

A. J. G. North & Sons invoices and our books 
of original entry. 

@. Were those invoices furnished you in the 
ordinary course of business? A. Yes. 

Q. The amounts set forth in the schedule cor- 
rectly set forth the amount of rental charged by 
J. G. North & Sons? A. Yes. 

Q. Were these equipments used exclusively in 
eonnection with Duque & Frazzini operations? 

A. Yes. 

Q. Will you explain how it happened that the 
equipments belonging to J. G. North & Sons were 
turned over to Duque & Frazzini, if vou know? 

A. I don’t know how they were turned over. 

Q. In other words, they were used exclusively 
by Duque & Frazzini? A. Yes. 

Q. And J. G. North & Sons charged Basich 
Brothers, and Basich Brothers in turn billed Duque 
& Frazzini for this equipment, is that correct? 


Bastch Brothers Construction Co. eo) 


(Testimony of George J. Popovich.) 

A. Yes. J. G. North & Sons were under contract 
with us, under the prime contract. 

Q. The equipment in Schedule XI had nothing 
to do with vour prime contract ? De iNor 

Q. In other words, it was rented by Duque & 
Frazzini ? A. Yes. 

Q. Upon what was the amount based set forth 
in Schedule X[? A. Oieex 

Q. Did you make any greater charge against 
Duque & Frazzini under your Schedule XI than 
was charged against Basich Brothers by J. G. 
North & Sons? A. No. 

Q@. Were any of these equipments used exclu- 
sively in connection with the Duque-Frazzini 
operations as distinguished from any JBasich 
operations ? A. Yes. 

Q. Would you, in your opinion, state that the 
amount charged in Schedule XI was the reasonable 
charge? A. Yes. 

Q. In reference to Schedule XII, Equipment 
Rental Fully Operated, B. B. Bonner 4/6/45 to 
4/24/45, $625.74, will you state from what records 
you base the items set forth in this schedule. 

A. 3B. B. Bonner’s invoices and time cards, 
equipment rental time cards. 

Q. Were those invoices and time cards weekly 


invoices and time cards? A. Yes. 
@. Prepared in the ordinary course of business. 
A. Yes. 
Q. The amount of rental was based upon what? 
A. O.P.A. rent. 


336 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

@. In your opinion that was a_ reasonable 
charge? A. Yes. 

@. Was this equipment, B. B. Bonner, referred 
to in this schedule, used exclusively in connection 
with the Duque & Frazzini job? A.” Wes 

@. As I understand, it was turned over to 
Duque & Frazzini by Basich Brothers, and Baasich 
Brothers were charged by Bonner, and Basich, in 
turn, charged Duque & Frazzini, is that right? 

ees: 

Q. Did you make any greater charges against 
Duque & Frazzini for the rental of this equipment, 
than were paid by Basich Brothers to Bonner? 

A. No. 


(Short recess. ) 


Q. (By My. Monteleone): Referring to Sched- 
ule XIII, Equipment Rental Not Fully Operated, 
Bressi & Bevanda, 4/24/45 to 6/9/45, $582.72. From 
what records did vou arrive at this amount set 
forth in Schedule XIIT? 

A. From the origial invoices. 

Q. Does this correctly set forth what the in- 
voices set forth? ea NICS, 

Q. So far as vour records show, this equipment 
was used in connection with the Duque & Frazzini 
joh? A. Yes. 

@. On what was the amount of $582.72 based ? 

A. On the O.P.A. rental rates. 

@. In your opinion was that a reasonable 
amount ? A. Yes. 


Basich Brothers Construction Co. B87 


(Testimony of George J. Popovich.) 

Q. Was it a greater charge made to Duque & 
Frazzini on this equipment than was charged 
against Basich Brothers? A. No. 

Q. Did you have anything to do, so far as that 
particular equipment was concerned, with it? 

A. Yes, Mr. Frazzini occasionally called me at 
the Los Angeles office, and asked for certain types 
of equipment, and parts and supplies quite fre- 
quently. I accommodated him. I found out what 
certain equipment was available, and certain parts 
and supplies were available. At this particular time 
he asked for a generator. I made my arrangement 
with Bressi & Bevanda, and a generator was re- 
leased to us. 

@. Bressi & Bevanda made a charge against 
you, and you made a charge against Duque & 
Hrazzini, is that correct? Ae Se Vie: 

Q. So far as vou know, this equipment was not 
used in any manner in connection with Basich 
Brothers’ operations? A. No. 

@. With reference to the equipment set forth in 
Schedule XIV, Equipment Rental Not Fully Oper- 
ated, Industrial Equipment Co., 4/6/45 to 5/8/45, 
$176.00—upon what records did you arrive at that 
amount ? 

A. Original invoices. 

Q. Those were kept in the ordinary course of 
business ? uo Yes: 

Q. The same way with the Bressi & Bevanda 
invoices ? A. Yes. 

Q. Upon what basis was the rental $176.00 ar- 
rived at? A. O.P.A. rental basis. 


338 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. In your opinion was that a_ reasonable 
charge? ees: 

@. So far as your records show, this equipment 
was used exclusively with the Duque & Frazzini 
job, is that correct ? Ae) es 

@. Was any greater charge made against Duque 
& Frazzini than was charged by the Industrial 
Equipment Co. against Basich Brothers? 

A. No. 

Q. With reference to Schedule XV, Equipment 
Rental Fully Operated, Basich Brothers Construc- 
tion Co., June 9, 1945, to September 16, 1945, 
$18,485.17—1pon what records were the amounts set 
forth in that schedule arrived at? 

A. From books of original entry and equipment 
time cards. 

Q. Were those kept in the ordinary course of 
business ? A. Yes. 

Q. Does the amount set forth in Schedule XV 
correctly set forth the amount as shown bv those 
records? sy URS. 

@. So far as the record is concerned, were these 
equipments used exclusively in connection with the 
work set forth in the subcontract of date February 
7, 1945? A. Yes. 

(. Upon what basis was the amount of rental 


of equipment fully operated? A. OP 
Q. In your opinion was that a reasonable 
charge? A. Yes. 


Q. So far as the records are concerned, were 


Y) 


any of these equipments set forth in Schedule XV 


Basich Brothers Construction Co. 339 


(‘Testimony of George J. Popovich.) 

used in connection with any other operation aside 
from the work specified in the subcontract of date 
February 7, 1945? A. No. 

Q. In reference to Schedule XVI, Basich 
Brothers Construction Co., Equipment Rental, Not 
Fully Operated, June 9, 1945, to September 8, 1945, 
€2,849.56—upon what record was this amount 
arrived at? 

A. From the books of original entry and the 
invoices. 

@. Were those records kept in the ordinary 
course of business? A. Yes. 

Q@. Upon what basis was the amount of the 
rental arrived at? A. O.P.A. 

Q. In your opinion, was that a_ reasonable 
charge? EVES, 

@. So far as your records show, was any of the 
equipment mentioned in Schedule XVI used on 
any other work outside of the work set forth in 
the subcontract of date February 7, 1945? 

A. No. 

Q. Referring to Schedule XVII, Basich Broth- 
ers Construction Co., Equipment Rental, Royalty 
Basis, $6,753.20, upon what records was that amount 
based? 

A. From the United States Engineers’ records 
and our books of original entry and our entire 
records. 

Q. What was used as the basis of the royalty— 
what amount? 


Ot0 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. They used 10 cents per ton on the Pioneer 
Crusher. 

Q. Does this refer to the Pioneer Crusher? 

A. Yes, and 10 cents for the hot plant. 

Q. In your opinion, was that a reasonable 
charge? A. Yes. 

Q. From your records can you state whether or 
not any of the equipment referred to in A VII was 
used in connection with any other work, outside of 
the work set forth in the subcontract of date Feb- 
ruary 7, 1945? A. No 

Q. Referring to Schedule XVili, Hquipment 
Rental Not Fully Operated, P.D.O.C., June 15, 
1945, to September 17, 1945, $108.50, upon what 
records, if any, do you base this figure? 

A. Original invoices. 

Q. Were those kept in the ordinary course of 
your business ? ie Yes: 

Q. What was the amount based on? 

A. O.P.A. rental. 

Q. In your opinion was that a reasonable 
charge? A. Yes. 

Q. So far as the records show, can you state 
whether or not this equipment was used exclusively 
in connection with the operation called for under 
the subcontract of September 17, 1945? 

No. 
It was? 


Was it used exclusively in connection 
with that work ? A. Yes. 
Not in connection with any other matter? 
That’s right. 


>SOPOo- 


Basich Brothers Construction Co. 341 


(Testimony of George J. Popovich.) 

Q. In reference to Schedule XIX, Equipment 
Rental Fully operated, P.D.O.C., June 9, 1945, to 
September 6, 1945, $10,412.27, will you state upon 
what records the amounts set forth were based ? 

A. The original invoices. 

Q. Furnished to you by whom? 

A. P.D.O.C. 

Q. Were the amounts scheduled correctly based 
upon those invoices ? A. Yes. 

Q. Upon what basis was the rental fixed in 
Schedtle XIX? A OP AS 

Q. In your opinion was that a _ reasonable 
rental ? A. Yes. 

Q. Will you state whether or not the equip- 
ment referred to in Schedule XIX were used ex- 
clusively in connection with the operation called for 
in the subcontract of February 7, 1945? 

A. Yes. 

Q. They were not used in connection with any 
other operation of Basich Brothers, is that correct ? 

A. Yes. 

Q. With reference to Schedule XX, Equipment 
Rental, Royalty Basis, P.D.O.C., $5,349.73, upon 
what records did you arrive at that figure? 

A. Original invoices by P.D.O.C. 

@. Were the invoices furnished by P.D.O.C. in 
the regular course of business? A. Yes. 

®. Upon what basis was the amount arrived at? 

A. O.P.A. rental rates. 

Q. In your opinion, was that a_ reasonable 
rental? 


342 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. In this particular rate, I did not have any- 
thing to do with it. Mr. N. L. Basich made that 
deal direct, but we have checked it, and that was 
in accordance with O.P.A. rental rates. 

Q. In your opinion was that a reasonable rate? 

Ete) 

Q. So far as the records concerned show, was 
that equipment used exclusively in connection with 
the work set forth in the subcontract of February 
7, 19452 A. Yes. 

Q. in reference to the Equipment Rental, Fully 
Operated, set forth in Schedule X XI, J. G. North & 
Sons, June 8, 1945, to September 12, 1945, $27,809.54, 
will you relate upon what records the figures set 
forth in this schedule were based ? 

A. Original invoices sent by J. G. North & Sons. 

Q. Those invoices were furnished to Basich 
Brothers in the regular course of business, is that 
correct ? A. Yes. 

Q. On or about the times the items were in- 
curred ? 

A. At the end of each month we would receive 
everything in detail from J. G. North. 

Q. Upon what basis was the rental! $27,809.54 
made? A. O.P.A. rentals. 

Q. In your opinion was that a reasonable rental? 

A. Yes. 

Q. Do the items set forth in Schedule XXI cor- 
rectly set forth the amounts you arrived at from 
these, invoices you have referred to? Ae Wes 


Basich Brothers Construction Co. 343 


(Testimony of George J. Popovich.) 

@. From your records can you state whether or 
not the invoices referred to in Schedule X XI were 
used exclusively for the operations set forth in the 


subcontract of February 7, 19457 A. Yes. 
Q. Were they in any manner connected with 
any operations ? A. No. 


Q. With reference to Schedule XXII, Equip- 
ment Rental Fully Operated, Phoenix Tempe Stone 
Co., June 15, 1945, to August 9, 1945, $6,102.05, upon 
what was that amount based? 

A. Original invoices submitted by Phoenix 
Tempe Stone Co., and from equipment time ecards. 

@. And they were kept in the ordinary course 
of your business? A. Yes. 

Q. Does the amount set forth in Schedule XXIV 
correctly set forth the amount as shown by those 
Invoices and records? A. Yes. 

Q. Can you state upon what the amount of 
$6,102.05 was based ? 

A. On O.P.A. rental rates. 

@. In your opinion was that a _ reasonable 
charge? A. Yes. 

Q. Will you state, from your records, whether 
or not the equipment was used exclusively in con- 
nection with the work set forth in the subcontract 


of February 7, 1945? A. Yes. 
Q. Was any of it used, do your records show, in 
connection with any other work? A. No. 


Q. In reference to Schedule XXIII, Equip- 
ment Rental Not Fully Operated, Bressi & Bevanda, 


344. Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
June 9, 1945, to September 10, 1945, $1152.61, upon 
what records did you arrive at that amount? 

A. From Bressi & Bevanda original invoices. 

Q. Does the amount in Schedule XXIII cor- 
rectly set forth the amount as shown by those in- 
voices ? A. Yes. 

Q. Were those invoices kept in the ordinary 
course of your business? A, Mes 

@. Upon what was the amount of $1152.61, set 
forth in Schedule XATII, based? 

A. O.P.A. rental. 

@. in your opinion was that a _ reasonable 
charge? A. Yes. 

Q. From your records state whether or not the 
equipment referred to in Schedule X XIII was used 
exclusively in connection with the work set forth 
in the subcontract of February 7, 1945? 

A, Wes: 

Q. It was not used in connection with any other 
work at all, is that correct? A. Yes. 

Q. That is, it was not so used, is that correct? 

RB. ) Yes: 

Q. In reference to Schedule XXIV, Equipment 
Rental, Not Fully Operated, Martin Construction 
Co., June 15, 1945, to September 8, 1945, $270.00, 
upon what was that based ? 

A. Original invoices. 

Q. That were furnished to you by this concern 
in the ordinary course of business? 

A, Yes. 

Q. Upon what was the rental based? 

A. Based on O.P.A. 


Basich Brothers Construction Co. 345 


(Testimony of George J. Popovich.) 

Q. In vour opinion was that a reasonable rental ? 

A MEGS 

Q. From your records can you state whether or 
not this equipment was used exclusively in connec- 
tion with the work specified in subcontract of Feb- 


ruary 7, 1945? A. Yes. 
Q. It was not used in connection with any other 
work, is that correct? A. Yes. 


Q. In reference to Schedule XXV, Equipment 
Rental, Not Fully Operated, Axman-Miller Con- 
struction Co., July 6, 1945, to September 17, 1945, 
$700.00, upon what, if any, records is this amount 
based ? 

A. Upen O.P.A rental rates. 

Q. What records did you use in arriving at it? 

A. Original invoices. 

Q. Sent to you by the Axman-Miller Construc- 
tion Co.? 

A. Yes. I was going to say one thing. On 
Schedule X XTV, when you told the Judge, you for- 
got to mention there was a correction made on that 
particular charge. 

Q. In other words, I under, Mr. Popovich, so 
far as your testimony is concerned, if there were 
any corrections made by me this morning, that will 
affect your answer ? 

A. Yes, but you did not mention this particular 
one, 

Q. I did not? A. No. 

Q. What correction do you desire to make in 
connection with that? 


346 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. This amount should be reduced. I have the 
records there. It’s a matter of some twenty-odd 
dollars. Seven days at $45.00 per month, a total 
of $21.00 overcharge. 

Q. In other words, there was a $21.00 over- 
charge in connection with the amount of $270.00, is 
that correct? A. Yes. 

Q. The amount should be $249.00 rather than 
$270.00 ? A. Yes. 

Q. Otherwise, your testimony stands as it, is 
that correct? Ao Meg 

Q. We are now referring to Schedule XXYV, 
Equipment Rental, Not Fully Operated, Axman- 
Miller Construction Co., July 6, 1945, to September 
17, 1945, $700.00. Upon what record is that based ? 
Original invoice. 

Kept in the ordinary course of business? 
GS, 

Upon what was the rental based ? 

O.P.A. rental. 

In your opinion was that a reasonable rental? 
Yes. - 

From your records will you state whether or 
not this equipment was used exclusively in connec- 
tion with the work specified in the subcontract of 


OPoProro-r 


February 7, 1945? Be NGOS: 
@. And not used in connection with any other 
matter, is that correct? A. Yes. 


@. In reference to Schedule XNVI, Repairs 
Made by Others on Basich Brothers Construction 


Basich Brothers Construction Co. 347 


(‘Testimony of George J. Popovich.) 
Co. Equipment, Not Fully Operated, $275.51. Will 
you state upon what records these were based? 

A. On original invoices. 

@. Were they kept in the ordinary course of 
business ? A. Yes. 

Q. Does the amount set forth in Schedule XX VI 
correctly state the amount as shown by those in- 
voices ? A. Yes. 

@. What was used as the basis in arriving at 
the figure $275.51? 

A. The details presented by the George Audish 
Welding Shop. 

Q. Was that based upon any O.P.A. rate, or was 


that just billed ? A. That was just billed. 
Q. In your opinion, was that a_ reasonable 
charge? Eee es. 


@. So far as your records are concerned, can 
you state what was the kind of these repairs? 

A. Repairing the Pioneer Crusher Plant. 

Q. That was while it was being operated ? 

A. We have the original invoices here. You 
would have to refer to those. 

Q. These were replacement parts, is that correct, 
so far as your records show? 

A. Yes, repair parts, or replacement parts. 

Q. So far as your records show, can you state 
whether or not the repairs were made to the equip- 
ment while it was being used in the performance of 
the work called for in the subcontract of February 
7, 1945? A. Yes. 


348 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. In your opimion do you state that was a rea- 
onable charge? A. Yes. 

Q. Now, in connection with Schedule XXVII, 
Parts Purchased for Basich Brothers Censtruction 
Co., Equipment Not Fully Operated, February 14, 
1945, to June 4, 1945, $2,259.88. On what was that 
figure based? 

A. From invoices presented by the vendors. 

Q. What is that? 

4. Invoices presented to us by the vendors. 

@. Presented to you in the ordinary course of 
business ? A ) Mes: 

Q. In your opinion were the charges shown on 
the invoices set forth in Schedule XA VII reason- 
able charges? ya LES, 

Q. From your records can you state what these 
parts were used for? 

A. In connection with the operation of the 
crushing plant and repair and replacement parts 
used in connection with the operation of the crush- 
ing plant. 

@. That is, used in connection with the operation 
of the Pioneer Crushing Plant while being cperated 
by Duque & Frazzini? AY Ves: 

@. Those parts represent replacement paris 
worn out, is that correct? A. Yes. 

Q. Lunderstand it is customary that snyene who 
rents equipment not fully operated is to make those 
repairs, is that correct? &. Yes: 

Q. In connection with Schedule XAVITi, Parts 
Taken From Basich Brothers Construction Com- 


Basich Brothers Construction Co. 2209) 


(Testimony of George J. Popovich.) 
pany Stock, $1,723.85. Upon what was that based ? 

A. Upon what was that based, did you say? 

Q. Schedule XXVIII, Parts Taken From 
Basich Brothers Construction Company Stock, 
#0(2o.10, Am I in error there? 

A. That is correct. I did not quite understand 
your question. 

@. I have not asked you a question. I just 
ealled this to your attention. 

A. Yes, I have it. 

®. Upon what records, 1f any, did you arrive at 
the figure $1,723.75? 

A. The figures were arrived at from the books 
of original entry showing these particular materials 
and parts were released. 

@. They were required by whom? 

A. Duque & Frazzini. 

Q. Were they used in connection with any par- 
ticular equipment, so far as your records show ? 

A. Yes. 

Q. What equipment? 

A. They were used for the crushing plant. 

Q. ‘That was the one they rented not fully oper- 
ated, is that correct? 

A. I would not know. I would have to refer to 
the details of this. 

Q. I mean so far as your records are concerned ? 

A. So far as our records are concerned, it was 
used for the Pioneer, and also our equipment. 

Q. Your own equipment? A. Yes. 


300 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. In connection with this operation under sub- 
contract of February 7, 1945? A. Yes, 

Q. In yvour opinion would you state that the 
parts furnished by Basich Brothers, for the sum of 
$1,723.75 was a reasonable charge? A. Yes. 

Q. When you say stock of Basich Brothers, did 
you happen to have this in your own stock? 

A. Yes, we have that tractor in our own stoek. 
‘They requested parts. We supplied them, and 
charged them the same price they were charged 


to us. 

Q. In other words, you made no profit in the 
deal? AY Yesmtiiat is vieht. 

@. In other words, instead of buying it, you took 
it from your stock? A. Yes. 

Q. You made no additional charge to them? 

A. No. 

@. As shown by your invoices? A. Yes. 


Q. In reference to Schedule XXIX, for Fuel, 
Grease and Oil on Equipmentt not Fully Operated, 
May 9, 1945, to June 31, 1945, $732.47, upon what 
was that figure based? 

A. From the original invoices submitted to us. 

Q. From your records, for what was the fuel, 
gas and oil used? 

A. Used in connection with the operation of the 
hot plant and other equipment. 

Q. Of whom? A. Duque & Frazzini. 

Q. Was any of it used in connection with any 
other operation outside of Duque & Frazzini’s? 

A. No. 


Bastch Brothers Construction Co. 351 


(Testimony of George J. Popovich.) 
Q. Upon what was the amount of $732.47 based, 


on invoices ? A. Yes, on invoices. 
Q@. In your opinion was that a_ reasonable 
charge? A. Yes. 


Q@. From your records, that was used exclu- 
sively in connection with Duque & Frazzini’s oper- 
ation ? A. Yes. 

Q. Now, you have Schedule XXX, Miscellaneous 
Labor Invoices, Etc., February 26, 1945, to June 
16, 1945, $2,814.24. On what record did you arrive 
‘at the figure $2,814.26? 

A. Books of original entry. 

Q. Do the items scheduled in Schedule XXX 
correctly set forth the amount as shown by your 
books of original entry ? A. Yes. 

(). Are those books of original entry kept in the 
course, ordinary course of your business? 

A. Yes. 

@. Will you state in your opinion whether the 
amount of $2,814.24 for the items so specified, was 
a veasonable charge? A. Yes. 

@. Upon what was that based, O.P.A. rates? 

A. That was based on invoices submitted to us, 
and are labor charges. 

@. From your records would you state that the 
items set forth in Schedule XXX were used ex- 
clusively in connection with the Duque & Frazzini 
operation under the subcontract of February 7 
1945? A. Yes. 

@. You have Schedule XXNXI Freight on 


? 


302 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
Rented Equipment, $326.89. On what records was 
that based? 

A. This was based from our shipping and stock 
memoranda. 

@. Original records which you made? 

A. Yes. 

Q. The items on Schedule XXI correctly set 
forth what your original records show? 

ia NEES, 

Q. What do your original records show, so far 
as these items are concerned—what were they for? 

A. It showed that certain equipment was trans- 
ported to Tucson, Arizona, from Los Angeles or 
elsewhere. 

Q. ‘To be used in connection with what operation ? 

A. Duque & Frazzini’s operation. 

Q. Exclusively? A. Yes. 

Q. In your opinion was that a_ reasonable 
charge ? A. Yes. 

Q. Now, you have Schedule XXXII, Repairs 
Made by Others on Basich Brothers Construction 
Co. Equipment Not Fully Operated, June 9, 1945, 
to September 10, 1945, $3,969.97. Upon what rec- 
ords was this amount arrived at? 

A. From original invoices. 

@. Kept in the ordinary course of business? 

A. Yes. 

Q. Upon what was that based? 

A. ‘That was based on invoices presented to us 
by the various vendors for work done. 


Basich Brothers Construction Co. 355 


(Testimony of George J. Popovich.) 

@. In your opinion was that a reasonable 
charge? J GBS, 

Q. From your records can vou state whether or 
not all of these repairs made were confined exclu- 
sively in connection with the work set forth in the 
subcontract of February 7, 1945? 

A. Yes, according to our records. 

Q. And in connection with no other work, is that 
correct ? pe es: 

Q. In reference to Schedule NXXIII, Parts 
Purchased for Basich Brothers Construction Co., 
Equipment Not Fully Operated, June 16, 1945, to 
September 9, 1945, $3,215.19, upon what records 
were those figures based? 

A. Invoices submitted to us for payment. 

@. In the ordinary course of business? 

A. Yes. 

Q. Can you state whethex or not the amount set 
forth in Schedule XX XITi is correct, as shown by 


these invoices? Eee Ves: 
Q. In your opinion was the amount of $3,215.19 
a reasonable charge? A. Yes. 


Q. From your records can you state whether or 
not the parts purchased in connection with equip- 
ment not fully operated were actually used in con- 
nection with and exclusively used in connection with 
the performance of work set forth in some contract 
of February 7, 1945? 

A. Yes, according to our records. 

Q. In connection with Schedule XXXIV, Parts 
Taken from Basich Brothers Construction Com- 


354 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
pany Stock, $1,028.91, upon what records was that 
amount based ? 

A. From records contained in our books of 
original entry, such as stock memorandums in our 
books, showing parts used. 

Q. Was that made in the ordinary course of 
business ? ie Yes: 

Q. The amount charged, $1,028.91, was a rea- 
sonable charge? A. Yes. 

Q. From your records can you state whether or 
not these parts were used in connection, exclusively 
used in connection with the operation of the work 
set forth in the subcontract of February 7, 1945? 

A. Yes, according to our records. 

@. In connection with Schedule XXXV, Fuel, 
Grease and Oil on Equipment Not Fully Operated, 
June 7, 1945, to September 6, 1945, $1,371.50, upon 
what records did you arrive at this figure? 

A. From records kept by our fuel man and these 
invoices submitted to us by Petroleum Company. 

Q. Were they kept in the ordinary course of 
business ? A. Yes. 

@. Does the amount set forth in Schedule 
XXXV correctly set forth the amounts shown on 
vour records? A. Yes. 

Q. In your opinion, is the amount set forth in 
Schedule XX XV a reasonable charge? 

A. Yes. 

@. From your records can you state whether or 
not fuel, grease and oil on this equipment were used 


Basich Brothers Construction Co. BOD 


(Testimony of George J. Popovich.) 
exclusively in connection with work performed as 
specified in the subcontract of February 7, 1945? 

A. Yes, from our records. 

Q. In connection with Schedule XXXVI, Mis- 
cellaneous Labor, Invoices, Ete., from June 7, 1945, 
to September 17, 1945, $4,803.15, can you state upon 
what records the amount set forth in this schedule 
was arrived at? 

A. Yes, from invoices presented to us for pay- 
ment, and books of original entry. 

Q. And they were kept in the ordinary course 
of business? ie Yes: 

@. In your opimion is the amount set forth in 
this Schedule XXXVI a reasonable charge? 

A. Yes. 

Q. From your records can you state whether or 
not the labor and invoices shown in Schedule 
XXXVI were used exclusively in connection with 
the performance of work set forth in the subcontract 
of February 7, 1945? 

A. Yes, according to our records. 

Q. I notice in Schedule XXXVI vou use the 
words ‘‘Overtime’’ and ‘‘Downtime.’’ What do vou 
mean by that? 

A. As I mentioned before, J. G. North had a 
contract with us, and our prime contract—in draw- 
ing up the agreement we stated in the event trucks 
were kept, and worked on the job, and we were un- 
able to use them, or Duque & Frazzini were unable 
to use them, so much was to be paid for labor only; 
not for the use of the trucks. To arrive at these 


356 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
amounts, by taking into consideration the time the 


plant was down 

Q. I want to know what they mean. 

A. Overtime for labor in excess of 8 hours work, 
and downtime was the time the equipment was not 
in use, and we had to pay for labor. 

Q. Schedule XXXVII, Freight on Rented 
Equipment, $663.39, upon what was that based? 

A. Based upon the original invoices received by 
us, and also the Railroad Commission freight rate. 

Q. That was kept in the ordinary course of 
business ? A COS 

Q. In your opinion was that a_ reasonable 
charge? A. Yes. 

Q. From your records can you state whether or 
not freight on rented equipment was equipment 
used in connection with, and used exclusively in 
connection with the Duque & Frazzini work, set 
forth in the subcontract of February 7, 1945? 

A. Yes, from our records. 

Q. In connection with Schedule XX XVIII, Pro- 
duction Gravel Base, $25,191.44, upon what records 
was this production based to arrive at the figure set 
forth in the Bill of Particulars? 

A. That was arrived at from engineering esti- 
mates, our engineer’s records and other records. 

(). Were those records kept in the ordinary 
course of business? A. Yes. 

Q. Does the amount set for in this schedule set 
forth the amounts as shown by those records? 

A. Yes. 


Bastch Brothers Construction Co. 357 


(Testimony of George J. Popovich.) 
Q. In connection with Schedule 
A. On Schedule XXXVIITI you forgot also to 

mention there was an error. 

@. What error was that? 

A. On Schedule XX XVIII the estimate dated 
June 15, 1945, which shows 567 cubie yards, which 
is the quantity shown on this exhibit, should read 
457 cubic yards, instead of 567. Therefore the total 
of 54,750 cubic yards, is correct, and agrees with 
the United States Engineers’ final estimate. 

Q. Referring to Schedule XXXVI, what cor- 
rection would you make? You have $25,191.44. 

A. The total is correct, but one of the items, line 
13, dated June 15, 1945, 567 cubic vards, that should 
be changed to 467 cubic yards. 

Q. Is the total amount cf cash correct? 

A. Yes. 

Q. In reference to Schedule XXXIX, Produc- 
tion Gravel Stabilized Base, $4,109.20, upon what 
records were they based ? 

A. Upon engineers’ quantities. 

Q. Were they kept in the ordinary course of 
business ? A. Yes. 

Q. The amounts set forth in these items correctly 
show what the engineers’ reported estimate is, is 
that correct ? A. Yes. 

Q. With reference to Schedule XX XX, Produc- 
tion Gravel Embankment, $4,719.60, upon what 
records was that based? 

A. Engineers’ estimates. 


308 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
Q. Was that kept in the ordinary course of 


business of the operation? A. Yes. 
@. These items correctly set forth the amount 
set forth in the engineers’ estimate ? A. Yes. 


Q. Schedule XNXXXI, Production Concrete 
Aggregate, $70,710.52, upon what records was that 
based ? A. Engineers’ estimates. 

Q. Was that kept in the ordinary course of 
business ? A. Yes. 

Q. Does the amount set forth in ths Schedule 
XXXXIT correctly show what is shown im the engi- 
neers’ estimates ? A. Yes. 

Q. On Schedule XX XXII, Production Mineral 
Aggregate, $15,377.93, upon what records was that 
based ? A. On engineers’ estimates. 

Q. Was that correctly kept in the ordinary 
course of business ? INe YESS: 

Q. Does this amount shown on Schedule 
XXXXII correctly set forth the amount shown on 
the engineers’ records? Anon NGOS, 

Q. Schedule XXXXIIJ, Production Concrete 
Aggregate for Structures, $405.30, upon what rec- 
ords was that based? A. Engineers’ records. 

Q. Does the amount set forth in Schedule 
XXX XIII correctly show the amounts set forth in 


the engineer's’ records ? A. Yes. 
@. Were those engineers’ records kept in the 
ordinary course of business? A. Yes. 


Q@. Schedule XXXXIV, Miscellaneous Credits, 
$1,319.86, upon what was that based? 
A. From engineers’ records. 


Bastich Brothers Construction Co. 259 


(Testimony of George J. Popovich.) 
Q. Miscellaneous credits? 
A. Yes, from engineers’ records and invoices 
submitted to individuals that obtained this material. 
Q. Does this amount correctly set forth the 


amount shown on those records? A. Ves: 
@. And those records were kept in the ordinary 
course of business? A. Yes. 


Q. In computing the dollars and cents, did you 
use aS a basis the amount as specified in the sub- 
contract for allowance? A. Yes. 

Mr. Monteleone: That is all. 


(Whereupon, an adjournment was taken 
until 2:00 o’clock p.m.) 


Los Angeles, California 
Tuesday, February 4, 1947, 2:00 p.m. 


GEORGE J. POPVICH 
recalled as a witness by and on behalf of the plain- 
tiff, having been previously duly sworn, resumed the 
stand and testified further as follows: 


Direct Examination 
(Continued ) 
By Mr. Monteleone: 

Q. Mr. Popovich, based on all of the records 
kept in the ordinary course of busmess by Basich 
Brothers in connection with the performance of the 
requirements contained in the subcontract of date 
‘February 7, 1945, introduced in evidence as Plain- 
tiff’s Exhibit 1, can you state whether or not the 


360 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Bill of Particulars, and the amendment thereto, 
referred to in the previous testimony, subject to 
corrections which were made, as has been testified 
or explained to the court, contains a full, true, com- 
plete and accurate statement of all of the charges 
and credits in connection with that particular 
matter ? A. Yes, sir. 

Mr. Monteleone: That is all. 


Cross-Examination 
By Mr. McCall: 

Q. Mr. Popovich, were you ever on the job at 
Tueson, Arizona? A. No. 

Q. Then all the information or testimony you 
have given here, you got it from records submitted 
to you by someone else, is that right ? 

A. From someone else’s records, and records 
we kept in the home office. 

@. And the records which you kept in the home 
office were in turn taken from records given to you 
by somebody else in Tueson, is that right? 

A. Yes, and also submitted by the home office 
to Tueson. 

@. I believe you said, in connection with Sched- 
we I, that the information which you used to make 
up that schedule was taken from payroll sheets 
which you have in court? A. Yes. 

Q. Do you have those before you? 

A. Yes, we do. 

@. How many payroll sheets do you have making 
up Schedule I? 


Basich Brothers Construction Co. 361 


(Testimony of George J. Popovich.) 

A. We have all payroll sheets from the begin- 
ning of the job, January 29th to October 12, 1945. 
To what date in October? 

The 18th. 

Your last record then was October 13, 1945? 
That is the date the job was finished. 

The first payroll record was January 29? 
Beginning with January 29. 


OrOoPoPeEe 


Can you look at vour records and tell when 

you hide the first charge against Duque & Frazzini? 
A. Commencing with the period February 11 to 

February 17, the first week that we commenced. 

Q@. How many time sheets do you have for 
Schedule I? 

A. Well, sir, we had all of them. There was 
all together, starting with 1—we have a grand total 
of 87 weekly pavroll sheets. 

Q. And those are not all relating to Schedule I 
of your Bill of Particulars? A. Correct. 

Q. You are unable to state then how many pay- 
roll sheets you used in making up Schedule I? 

A. I don’t quite follow you there, sir. 

Q. In making up Schedule No. I of your Bill 
of Particulars, I understood you to testify in your 
direct examination this morning that the payroll 
sheets were the basis of your information in making 
this up. A. Yes, sir. 

Q. Will you refer then to the first payroll sheet 
that you have, which is from February 11 to 17, 
you state. 

A. All right. Do you have reference to our pay- 


362 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
roll sheet or Duque & Frazzini’s payroll sheet? We 
have both of those here. 

Q. Which did you use in making up Schedule 
No. I? 

A. Payroll sheets and time cards as submitted 
by Duque & Frazzini. 

Q. That is, to make up your Schedule No. I? 

Ave Y es isin: 

Q. Do you have the time cards in court? 

A. We have some here, but we did not bring 
them all. 

Q. Will you show me the payroll sheet from 
February 11 to February 17, please? 

A. Yes, we have it right here. That is the one 
presented to us by Duque & Frazzini, and here are 
both of them. 

Q. This weekly payroll sheet that represents 
time covering the term from February 11, 1946, to 
February 17, 1945, Sheet No. 1, or two sheets, Pay- 
roll No. 3, does this weekly payroll sheet contain 
the employees only who worked on the subcontract 
for that week ? 

A. That contains the subcontractors and our 
employees. 

Q. Plus your employees too? A. Wes 

Q. The employees on this sheet then are the em- 
ployees on the general job, the entire job? 

A. Yes, with the proper segregation made on the 
distribution sheet for the various charges. 

Q. And they are listed ingalphabetical order, are 
they not? A. Yes, they are supposed to be. 


Basich Brothers Construction Co. 363 


(Testimony of George J. Popovich.) 

@. Would you point out to counsel and the court 
where the segregation is made for the employees 
for Duque & Frazzini? 

A. Yes, we have Duque & Frazzini shown right 
here, account No. 7, which represents accounts re- 
ceivable charges, Duque & Frazzini. 

Q. From what information, Mr. Popovich, did 
you make this segregation ? 

A. ‘That was made from Duque & Frazzini pay- 
rolls submitted to us, plus time cards. 

@. Were the payrolls and time cards submitted 
to you, or someone else? 

A. ‘That was submitted to the home office. That 
was the original payroll of the job, which was sub- 
mitted to the home office. 

Q. This payroll they submitted to the home 
office is the only thing that you saw? 

A. Yes. 

Q. You did not see timecards therefor too? 

A. I did see the time cards, in making the audit 
with Homer Thompson. 

@. This sheet on top attached, is that the weekly 
payroll of Duque and Frazzini? 

A. Only that time sheet represents a payroll 
distribution, classifying the distribution of the 
various types of operation and work, including 
Duque & Frazzini accounts receivable, subcon- 
tractor. 

Q. You do not have the payroll then of Duque 
& Frazzini separate from the other payrolls? 


364 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. Yes, we do, from Duque & Frazzini payroll 
sheets. This information is exactly set forth in our 
payrolls. 

Q. Would you show me then, Mr. Popovich, the 
weekly payroll sheet which you received from 
Duque & Frazzini, please? Which is the payroll 
sheet which you received from Duque & Frazzini? 
What you have handed me is comprised of many 
sheets. 

A. These represent each weekly payroll sheet. 

Q. For Duque & Frazzini only? 

A. For Duque & Frazzini only. This is the 
sheet that was turned over to our office manager, 
Homer Thompson, by Duque & Frazzini. 

@. I understood you to say that vou had weekly 
payroll sheets covering the time from February 11 
to February 17, for Duque & Frazzini. Can you 
point them out for us? 

A. I had the payroll sheet from February 11 
to February 17? 

Q. Yes. 

A. That’s the one on top. That is the sheet that 
our field office received. 

Q. Does that include the second sheet next ic it? 

A. Yes, sir, he has received all these sheets. 
These were made up by Duque & Frazzini. 

Q. They cover from February 11 to February 
17? A. And also other weekly payroll sheets. 

Q. Can you show us where are the names of the 
employees, submitted by Duque & irazzini? 


Bastch Brothers Construction Co. 365 


(Testimony of George J. Popovich.) 

A. On the left-hand column of each sheet, it 
shows the last name and the first name. 

Q. The sheet next to that, this large weekly pay- 
roll sheet, where did this come from? 

A. Duque & Frazzini. 

Q. And that covers only the employees of Duque 
& Frazzini? 

A. You have particular reference to the one 
ending March 10? 

Q. From the 17th of February to March 10. 

A. This is the one you have particular reference 
HO, ISA ie Se 

@. Would you read the question again to the 
witness ? 


(Question read by the reporter.) 


Mr. Monteleone: Mr. McCall, you pointed out 
a certain document to the witness. He is wondering 
whether you specified the particular document you 
are er. to. 

yr, McCall: I will try to frame it more intelli- 
e then. 

Q. Mr. Popovich, the large sheet that you hold 
next to you there, does that contain employees only 
of Duque & Frazzini, or others too? 

A. As explained to you, this contains Duque & 
Frazzini. We also have time cards representing 
Duque & Frazzini, but we don’t have all the time 
cards here. 

Q. Does this contain Duque & Frazzini’s em- 
ployees only? A. This sheet here? 

Q. Yes. A. Yes. 


366 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. No other employees except those who worked 
for Duque & Frazzini? 

A. As explained, there were time cards also for 
Duque & Frazzini, but they are not included here. 

Q. The employees mentioned on the time cards 
for Duque & Frazzini are not included here? 

A. We have other time cards that might not be 
Duque & Frazzini payroll. This is one portion. We 
have another portion we did not bring all the time 
cards up, but, however, we do have some time cards 
that represent the payroll of Duque & Hrazzini. 

Q. As 1 understand it, Mr. Popovich, the pay- 
roll sheets that you have before you there, from 
which you made up Schedule No. 1 of your Bill 
of Particulars, show the name of the employee and 
the amount of his wages, is that right? 

A. Yes, sir. 

Q. Now, where is Jack Brown shown on your 
payroll sheet? 

A. For the week ending March 10, shown here. 

. Is it shown prior to that? 

A. I would have to look at the previous payrolls 
to determine that. You have reference to March 17. 
I have it here, sir. Here is Joe Brown. 

Q. From this payroll sheet you say that you 
made up Schedule No. I? A. Yes, siv. 

Q. Then how did you segregate 

A. The time cards? 


Q. Then how did you segregate these employees 


Basich Brothers Construction Co. B67 


(Testimony of George J. Popovich.) 
shown in Schedule I, say Jack Brown and Jack L. 
Brown? 

A. How did we segregate them, sir? 

Q. Yes, how could you tell that they were 
Duque & Frazzini’s employees? 

A. By the time cards submitted to the field 
office and weekly payroll sheets submitted to the 
office. 


Q@. Where are the weekly payroll sheets? 

A. These are the ones. 

@. This is the weekly payroll sheet for the 
period from March 11 to March 17? 

A. Yes, sir. 

@. Do you know who made up this sheet? 

A. Who made it up, sir? 

(). Yes. 

A. No, Homer Thompson was field office man- 


@. He made it up? 

A. No, Duque & Frazzini made this up, and 
they were presented to him. 

Q. Do you recognize the handwriting as being 
that of Duque or Frazzini? 

A. I don’t know. I never checked their hand- 
writing. 

Q. That was just the information that was given 
to you? A. Yes, sir. 

Q. Did you ever see the time cards prepared by 
Duque & Frazzini? 


368 Glens Falis Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. Did I ever see the time cards prepared by 
Duque & FKrazzini? 

Q. Yes. 

A. No, sir, I never was on the job. 

Q. Or on Schedule No. 1? 

A. I wasn’t on the job. I didn’t see them pre- 
pared. 

Q. So you don’t know whether there are any 
time cards on Schedule No. 1 or not, do you? 

A. I didn’t find time ecards. Those from the 
weekly payroll sheets show that there are time 
ecards and weekly payroll sheets from Duque & 
Frazzini. 

Q. This which purports to be the weekly payroll 
sheet is the regular payroll sheet that was used by 
the Basich Construction Company on all of its johs? 

A. That’s right, our regular forms, yes, sir. 

Q. I will ask you to look at that payroll sheet 
from February 17th to March, and state if it is 
signed by either Duqne or Fvazzini? 

What dates were those, sir? 
From February 17 to February 24? 


a 


Q 

A. I don’t see any signatures on the payroll. 

Q. Will you read them? 

A. Will I read them? 

Q. Will you state to the court, Mr. Popovich, 
if you can find the signature of Duque or F'razzini 
on any of the payroll sheets? 

A. JI would have to go through al! of these. I 
have many time cards here showing the signature 
of Duque & Frazzini. 


Basich Brothers Construction Co. 369 


(Testimony of George J. Popovich.) 

Q. Isn’t it a fact, Mr. Popovich, that none of 
the weekly payroll sheets were ever signed by 
Duque or Frazzini? 

The Court: So far as you know, from the evi- 
dence before you? 

A. Yes, | would have to check these. These were 
the ones presented to us, which show Duque & Fraz- 
zini’s name, but whether or not it was their hand- 
writing I would not know. These were presented 
to our field office, to the manager, Homer ‘Thompson. 

@. Have you a time card in front of you which 
has the signature ? A. Yes, sir. 

@. Of anyone? 

A. Here is Mr. Duque, Duque, Duque, Frazzini. 

The Court: Do you want to look at some of 
these exemplars here? 

Mr. Monteleone: I notice this is dated May 9. 
Do you have any from February? 

A. We haven’t checked them all, sir. I would 
have to go through all the time cards to answer that. 

Q. (By My. Mc@all): It appears these are all 
for May and for June. 

A. There are some here for May, June, and, as 
IT mentioned to you, we have other time ecards also 
which we did not bring with us. 

@. Mr. Popovich, do you have a weekly payroll 
sheet covering the time from February 24 to 
March 3rd? 

A. Yes, sir, we have the original payroll sheet 
here. The week ending February—do you have ref- 
erence to the week ending February ? 


370 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. No, from February: 24 to March 3rd. 

A. February 24 to March 3rd. Here is the home 
office original payroll sheet. 

Q. Is this large sheet from February 295 to 
March 3rd the original payroll sheet? 

A. The original payroll sheet sent to the home 
office by the field office. 

@. And it includes all the employees of both 
Basich Brothers Construction Co. and Duque & 
Frazzini? A. Yes. 

Q. It includes those in alphabetical order? 

A. Yes. 

Q. What do you have here that would indicate 
any of these employees worked for Duque & Praz- 
zini on the subcontract? 

A. We have records to support the charges 
made against the subcontractor, Duque & Frazzini. 
Those records were compiled from the daily time 
cards and weekly payroll sheets that were submitted 
to our field office. 

Q. Do you have the weekly payroll sheet that 
was submitted for this particular time? 

A. We have the weekly payroll sheet. However, 
we don’t have all the time cards. 

Q. Would you exhibit the weekly payroll sheet 
for the time from February 25 to March 3rd? 

A. Our payroll sheet last year? 

Q. Would you exhibit that to the court? 

A. <Yeswsit: 


Q. What you have just shown to the court there 


Bastch Brothers Construction Co. O71 


(‘Testimony of George J. Popovich.) 
is a record which was furnished to you by your 
home office, is that right? A. Yessir 

@. It does not purport to cover the subcontract 
employees only; it covers all employees on the job? 

A. Yes, sir, with the proper notation on them, 
of the labor for Duque & Frazzini. 

The Court: I think we ought to identify this. 
It is a document which I do not feel like taking 
away from your records. The Income Tax Depart- 
ment might want to see it some time. Let us iden- 
tify it by saying there is presented to me three 
large sheets entitled: Weekly Payroll Sheet, called 
Payroll No. 5, Job 19, at Tucson, which list alpha- 
betically the names of the employees, and the 
eapacity in which emploved, the hours they work 
each day of the week, the total of hours, the rate 
of pay, gross wages, Federal Old Age Tax, total 
deductions, net amount due, and Check No. so 
and so. 

Then in front of it is the distribution sheet en- 
titled: Payroll Distribution. Which distributes the 
wages as paid to various activities, such as re- 
moving, miscellaneous utility, excavation, grading, 
searifying, and so forth. Also the names of persons 
or firms for whom these accounts were paid: Duque 
& Frazzini, J. G. North, F O A. Payroll distribu- 
tion. Each one of these weekly sheets has in some 
form or other a payroll distribution attached to it? 

A. Yes; those are the detailed records that this 
was made up on. 


Sie Glens Fails Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. After you make up this payroll sheet—shall 
we call it the master sheet? A. Yesein 

Q. Then you attach to it the distribution sheet 
which allows you to charge to various departments 
of your own, and to other persons to whom you have 
advanced the money, the particular amount? 

Le Nice 

Q. My question is, do all your other payroll 
sheets have such distribution sheets attached to 
them ? A. Always. 

The Court: I think that is description enough. 

Q. (By Mr. McCall): Then, Mr. Popovich, 
this distribution sheet was made by whom? 

A. Made by the field office, Homer Thompson. 

@. Did you have before you the payroll data 
from which it was made? 

A. Yes, sir, we did have Duque & Frazzini’s 
weekly payroll sheets. However, we don’t have all 
the time cards available here. 

Q. Will you exhibit to the court now the in- 
formation from which you mace this distiibution 
sheet which you just showed the court? 

A. This distribution sheet here? 

. Yes. 

A. We don’t have all that information here, sir. 
@. Do you have any of it here? 

A. May I ask Hemer Thompson if we brought 
iy of that? 

Q. LY you doen't know it of your own knowledge. 
A. We don’t have it here. We have so many 
files—about 15 or 20 files made up on this job. 


Basich Brothers Construction Co. aa 


(Testimony of George J. Popovich.) 


Mi. Monteleone: You have seen them, Mr. 
McCall. 


Q. (By Mr. McCall): I show you what pur- 
ports to be a memorandum to the defendant Glens 
Falls Indemnity Company, regarding plaintiff’s 
Bill of Exeeptions, which I hand to you, and I 
will ask you if you have seen that before? 

pee eS, Sit. 

@. Beginning with page 1 there, which says: 
Page 1 of Bill of Particulars, on the left-hand side; 
then we have the name Jack Brown, tractor dviver, 
and 3/17/45, Saturday, time card recorded 814 
hours, was paid for 11 hours, overpaid 244 hours, 
$5.62. Did you check that to see if it corresponded 
with your records? A. The time card, sir? 

Q. Yes. 

A. We have no knowledge of any time cards. 
We have never seen them. Duque & Frazzini’s pay- 
roll sheet, submitted to us, showed 11 hours Sat- 
urday work, March 17th. He was paid for i1 
hours. 

Q. Where is the time card, or the information 
from which you got the 11 hours? 

A. Duque & Frazzini’s weekly payroll sheet. 

Q. Where is the 11 hours shown on Duque & 
Frazznii’s weekly payroll sheet? 

‘x 6Hleré, sir. 

Q. Isn’t that the sheet that was made by some- 
one other than Duque & Frazzini? 

A. This weekly payroll sheet was submitted by 


374. Glens Falls Indemnity Co. vs. 


(‘Testimony of George J. Popovich.) 
Duque & Frazzini to Mr. Homer Thompson, our 
office manager. 

®. Do you know of your own knowledge that 
this individual sheet was prepared by Duque & 
Frazzini ? 

A. Iwas not on the job. I would not know, sir, 
but from the records submitted to Homer Thomp- 
son, and I verified it with the payrolls, and the 
moneys paid, they are correct, sir. 

(. You have no further information to support 
that? mee Eats right, 

@. IJ show you what purports to be a time ecard. 
On the card it reads: Basich Brothers Construction 
Company. Time ecard for 3/14/45. Name J. L. 
Brown, and I will ask you have ever seen that 
time card before. A. No, sir. 

Q. Do you know if it is signed by Jack Brown? 

A. I don’t know his signature. 

Q. How many hours does it show? 

Mr. Monteleone: I object to that, if the court 
please. There is no proper foundation laid that this 
man has ever seen this type of card. 

The Court: I think he can look at it and see 
what it contains. 

Myr. Monteleone: If your Honor please, may I 
eall the court’s attention to the deposition of Mr. 
Frazzini that was taken here? Probably the court 
has not had time to read it. 

The Court: I did not have an opportunity. 

Mr. Monteleone: Let me read this portion from 


Bastch Brothers Construction Co. “sty 


(Testimony of George J. Popovich.) 
page 42. These were questions I asked Mr. Frazzini, 
whom I had never seen before: 
‘*Q. Ineidentally, what did you do by the 
way, with the time cards after they were pre- 
pared by you or under your supervision ? 


In other words, the daily time cards were con- 
verted into weekly payrolls submitted to Basich 
Brothers. 

‘CA. Segregated them into boxes for time 
periods. 

‘““Q. And did you prepare a payroll from 
those time cards? 

“A. I did not do so personally. 

“Q@. Who did? 

“A. J believe that if any were prepared 
that they would be by Mr. Duque who was pre- 
paring the payroll cards. 

‘“Q. I see. And when those payroll cards 
were prepared by Mr. Duque, what was done 
with those cards? 

‘A. They were put into boxes and kept in 
our office. 

“Q. Were any of them given to Basich 
Brothers Construction Company ? 

‘A. Not to my knowledge. 

“Q. Do you know what became of those 
payroll cards? Aa do: 

‘‘@. Where are they? 

‘CA. I gave them to Mr. John Bray of the 
Glens Falls Indemnity Company for checking 
and auditing. 


376 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
‘*™. When did you give these payroll cards 
to Mr. Bray? 
‘fA. As near as I can remember, I would 
say some time last fall.’’ 


If your Honor pleases, Mr. McCall apparently 
had these time cards at the time Mr. Basich’s depo- 
sition was taken, and had an opportunity to eall 
them to Mr. Basich’s attention. 

The Court: I think they can show by compari- 
son what was on the time cards, because some time 
ecards have shown up. Go ahead. Overruled. 

A. We have never had time ecards at all, sir. 
That 1s, we have never seen those time cards. 

The Court: Before now? 

A. That’s right. The only thing we went by 
was given to us by Duque & Frazzini. 

®. Whether that shows a correct reflection of 
the time cards or not, you don’t know? 

No. 

Somebody may have made a mistake? 

Yes. 

Duque & Frazzini handed vou the sheet? 

. Yes. That was on the sheet, 11 hours, and 
we paid 11 hours. 

Q. (By Mr. McCall): Then I will ask you to 
look at that memorandum relative to plaintiff’s 
Bill of Particulars, from page 1 to page 15, which 
covers 

A. Is that Schedule I? 

@. Plaintiff’s Schedule I? A. I have it. 


> OPO > 


Bastch Brothers Construction Co. OI 


(Testimony of George J. Popovich.) 
Oo) which purports to cover the difference 
in time on Schedule i? Me Yom oir 
? 


Q. J will ask you if you have ever seen any 
cards,-or any of these naines—time cards? 

A. Well, sir, I made a detailed andit of the 
questions you have asked. They came to me. The 
dates specifically IT can’t tell vou, because I have 
got about 50 pages, and I couldn’t point out any 
particular one. 

Q. You do not on the first 15 pages then find 
any errors in your Bill of Particulars which are 
mentioned here? 

A. Well, sir, I have all the answers for all your 
questions here. I will have to refer to cach sheet. 

Mr. Monteleone: Mr. McCall, there were cer- 
tain items in your exceptions that I corrected this 
morning. Subject to the correction made this 
morning. 


Q. (By Mr. McCall): Subject to the correc- 
tions made this morning? 

A. Well, sir, I don’t know of any, unless I 
refer to my working papers in detail. 

Q. Outside of corrections you made this morn- 
ing, you would say you have not seen any informa- 
tion to support the entries mentioned from pages 
tio 154 

A. I did not see any other papers except the 
daily time cards and the weekly payroll sheets. 

®. Some of these items mentioned on page 15 
I notice were corrected by counsel this morning ? 

a, Yes, Sir. 


378 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. On Schedule No. 2, Mr. Popovich, can you 
tell the Court what Schedule No. II covers in your 
Bill of Particulars ? 

A. Yes, sir, No. II covers Pioneer crushing 
operation from March 25 to June 9. 

Q. Then, will you look at the name Hutchins, 
on page 3 of Schedule II. He is listed as a welder, 
but was paid $1.75 regular time, and $2.625 over- 
time. Do you have that before you? 

A. Yes, sir. 

Q. Do you have the welders’ rates before you? 

A. Ido not. I did not bring the rates with me, 
sir. 

Q. Do you know whether or not he was paid 
the rate of $1.875 regular time, and $2.0625 over- 
time, or $2.25 overtime for that day? Do vou know 
whether he was paid it or not? 

A. I have checked the payroll, sir, and found 
we paid him $1.75. Duque & Frazzini borrowed this 
employee from us, and we always paid Mr. Hutchins 
$1.75 an hour for straight time, because he was 
considered a foreman. 

Q. Then since you have looked over the com- 
ments here on Schedule I1—is that Manuel Villa- 
real? A. Did you say page 18, sir? 

Q. Yes. 

A. I don’t have anything on him. 

Mr. Monteleone: There was a correction made 
on page No. 23. 

The Witness: What page? 

Mr. McCall: Page 18 of your comments on the 


Basich Brothers Construction Co. 579 


(Testimony of George J. Popovich.) 
Bill of Particulars, and it is on page 23 in the Bill 
of Particulars. A. Yes, I have that here. 

Q. The information given in our statement is 
correct on that, isn’t it? 

A. Sir, this shows an overcharge in the amount 
of $6.12 was made. Therefore, the correct charge 
should have been $49.44 instead of $55.56. I thought 
Mr. Monteleone brought that out. 

The Court: He wants to know, other than that 
correction, do you have any others as to which vou 
admit an error? A. We might have. 


Q. (By Mr. McCall): On Sehedule II you 
have all the cards on that schedule, have you not? 

A. We have those cards that were presented to 
us by Duque & Frazzini, and the weekly payroll 
sheets presented to us by Duque & Frazzini. I 
don’t think we have all the time cards. We have 
some of the cards. They are all at the office, those 
that we don’t have here. 

Q. Schedules I to V represent the payrolls of 
Duque & Frazzini, do they not? 

A. Schedules I and V? 

Q. Of your Bill of Particulars. 

A. It all has reference to Duque & Frazzini. 
Schedule Ii has, Schedule [LT has, Schedule £V 
has, and Schedule V has reference to Duque & 
Frazzini. 

Q. Do you have before you Schedule No. II, 
Mr. Popovich? A. Yes, sir. 

Q. What is that schedule for? 


380 Glens Falls Indemnity Co. vs. 


(‘Testimony of George J. Popovich.) 

A. Schedule IT is payroll for Pioneer Crusher 
from March 25, 1945, to June 9, 1945. 

@. Can you tell the court why this payroll for 
the Pioneer Crusher was kept separate from the 
payroll shown in your Schedule No. 1? 

A. I don’t know. 

Q. Do you recognize these employees in Sched- 
ule II as old employees cf Basich Brothers Con- 
struction Co.? 

A. We have so many of them. Hutchins I know 
is; | know Lew Stephenson. It is hard for me to 
say just who I know, because we have had three 
or four hundred men working for us on different 
projects. 

Q. Paul Albino, mentioned in the first line of 
Schedule II, is that an old employee? 

A. He worked for us off and on. Not steady, 
though. 

Q. How many vears had he been working for 
Basich Brothers ? 

A. I would not know, sir. I would have to 
refer to our records. 

Q. Then in your comments, from page 16 to 
page 19, regarding Schedule II, in which the men 
are paid higher than their ratings called for, do 
you know why they were paid higher than the 
rating ? 

A. They were paid according to the weekly pay- 
roll sheet submitted to us showing the rates Duque 
& Frazzini sent to us. 


Bastch Brothers Construction Co. 381 


(Testimony of George J. Popovich.) 

Q. The weekly payroll sheets show the rate? 

A. Yes, sir, they do have the rates. 

The Court: When you loaned an employee to 
them, you paid them regardless, whether it was 
the current rate or not? 

A. Yes, sir, whatever our men received, if they 
were borrowed they were paid the same rate that 
we paid them. 


Q. (By Mr. McCall): Mr. Popovich, will you 
exhibit to the court the payroll sheets on Schedule 
No. IT? 

A. You will have to be more specific, because 
there are a lot of payrolls here. 

Mr. MeCall: Will you please read the answer, 
just prior to this one, showing what Schedule No. 
IT was made up from? 


(Record read by the reporter.) 


Mr. Monteleone: Have you got Schedule No. I1? 

A. I have it. 

The Court: That is 3-25-45 to 6-9-45. Pioneer 
Crusher? 

A. Yes. That was made up from my weekly 
payroll sheets and daily time sheets that were pre- 
sented to us. 

Q. (By Mr. McCall): Will you exhibit to me 
please, Mr. Popovich, one of the weekly payroll 
sheets on Schedule Ii? 

A. They cover a period from March 25 to June 
Oielat 

@. Yes. 


oon Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. We have one here from May 20 to May 26. 
That’s our original payroll sheet. 

@. None of these which you have exhibited to 
me, which you call your original payroll sheets, was 
submitted to you by Duque & Frazzini, was it? 

A. Sir, here are weekly payroll payroll sheets 
submitted to us by Duque & Frazzini. Also we have 
daily time cards sent to us by Duque & Frazzini. 

@. Time cards on Schedules I or II? 

A. We have weekly payroll sheets, and we also 
have daily time sheets to support any charges made 
to Duque & Fyrazzini. They were either on the daily 
time cards, or they were on the Duque & Frazzini 
weekly payroll sheets. 

@. Then would you show me, please, Mr. Popo- 
vich, the weekly payroll sheets from which this 
master sheet was made up? 

A. Yes, here is the weekly payroll sheet. I 
don’t think we have all the daily time cards with 
us, but we do have some of them here, sir. 

Q. What is there on that that you can tell that 
it is made up of Schedule No. II? 

A. Well, sir, we have sheets where this has been 
taken into consideration and posted on it, our 
weekly payroll sheets. 

@. Referring to your bill of particulars on 
Schedule No. 2, will you show the court just how 
you took it off of these records, and put it on your 
bill of particulars? 

A. We did not bring all of our accounting 
working papers up here, which we used, but we 


Bastch Brothers Construction Co. 383 


(Testimony of George J. Popovich.) 

did have a segregation of the labor charges of 
Duque & Frazzini, but we would have to have all 
the working papers here to answer the question. 

Q. You are not able to exhibit here how you 
made up Schedule No. II from the records you have 
here in court today. 

A. Homer has some time cards, but we do not 
have all of them because, as I said, we have so 
many files it would be impossible. Here are the 
daily time cards signed by the employee, and ap- 
proved by Duque & Frazzini’s foreman. 

Mr. Monteleone: What schedule is that one, 
Mr. McCall? 

The Court: How ean you tell, by the date? 

A. I can tell by the date, sir. See right here. 
You would have to point cach particular thing out, 
so we could support them, because it is impossible 
to pick them out of the air. 

Q. Mr. Popovich, I believe you stated to the 
court that the payroll sheet on Duque & Frazzini 
covers Schedule No. U1, is that correct? 

A. I stated, sir, that the weekly pay roll sheets, 
together with daily time cards, represent charges 
in Schedule II. 

Q. My. Popovich, is it not a fact that you do 
not have any payroll sheets from Duque & Frazzini 
covering Schedule No. II? A, SSin? 

Q. Is it nota fact that you do not have any pay- 
roll sheets covering Schedule IL? 

A. Well, sir 

q. ‘That is, made up by Duque or Frazzini? 


384 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. Sir, all of this information was taken from 
Duque & Frazzini’s daily time cards, plus weekly 
pay roll sheets. All factors were taken into con- 
sideration to arrive at the charges appearing on 
Schedule I. We worked with both of them. We 
have everything here. There is no distinction made 
as to who prepared them for Duque & Frazzini. 
They are all considered Duque & Frazzini time 
cards and weekly payroll sheets. We did not make 
any distinction. They are here. Your time cards 
and vour weekly payroll cards, all of this data was 
to make up the weekly payroll and accounts re- 
ceivable by Duque & Frazzini. 

Q. Did you make any distinction between the 
data that you used to make up Schedules I and II? 

A. Did we make a distinction ? 

The Court: Did you make any distinction be- 
tween the data used between J and IT? 

A. We used all this data to compile this. That 
is the detail of all the particulars here. It was 
necessary to use all the data we received from 
Duque & Frazzini. 

@. Since you have these records before you, Mr. 
Popovich, can you illustrate to the court how you 
went about to make up Schedule I or Schedule II 
of your Bill of Particulars from that data? 

A. We don’t have the working papers with us. 
I transposed this data onto the working paper to 
show the distribution or segregation. However, we 
do have them at the office. 

@. So you cannot illustrate to the court how 


Bastich Brothers Construction Co. 385 


(Testimony of George J. Popovich.) 
you used this data in making up your Bill of Par- 
ticulars ? 

A. We don’t have all the necessary data to do 
that. 

@. You referred to vour working sheets as to 
the data, Mr. Popovich. What kind of material is 
that? . 

A. Well, sir, to make this accounting for the 
Pioneer Crusher, that was carried separately. That 
distinction apparently was made on the accounting 
distribution for a reason I don’t know. But all the 
men that were performing on the Duque & Frazzini 
operation, they were charged on the accounts re- 
ceivable, subcontractor, Duque & Frazzini. Mr. 
Homer Thompson has compiled that data, and IL 
have made that distinction. I would have to go 
through all of that data to pick out each one em- 
ployed, but if you refer to Schedule [I we do have 
the names of those individuals, but these are not 
original records we used. 

Q. Then personally, Mr. Popovich, you cannot 
go through these master sheets and point out from 
the record that you have, the difference between 
the employees of Duque & Frazzini, and those of 
any other contractor ? 

A. You could, because we have weekly payroll 
sheets, and have Duque & Frazzini’s daily time 
cards, and so, therefore, we could say those charges 
were made to Duque & Frazzini, because we do have 
their slips here. As for the segregation, we have 
that data. We have the data I have testified to. 


386 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Mr. Homer Thompson compiled the data to show 
how we arrived at it, but we do have all the weekly 
payroll sheets and time cards. 


(Short recess.) 


Q. (By Mr. McCall): I believe you stated be- 
fore recess that you have before you some of the 
weekly payroll sheets submitted to the plaintiff by 
Duque & Frazzini, from which you made up Sched- 
ule No. II, is that correct? 

A. Yes, we have the weekly payroll sheets, and 
some of the time ecards; not all of them. 

Q. The time cards that you have before you are 
dated in what month? 

A. Some of them are in May. Here is one May 
14th. We have some in June. 

Q. All the others are June, 1945, are they not? 

A. We have them in May. Like I say, I would 
not know, because I don’t have them all with me. 

Q. How many do you have for the month of 
May? 

A. I would have to segregate them. May, and 
some for June; just a few were all we brought. 

. You only have one for the month of May, 
don’t you? 

A. We have quite a number. Here they are. 
Here is May 14th? 

Q. Will you look at the weekly payroll sheet 
from which you made up Schedule No. IJ, and find 
on that the name of Paul Albino? 

CA. What page is that on, sir? 


Basich Brothers Construction Co. 387 


(Testimony of George J. Popovich.) 

Q. Schedule No. II of your Bill of Particulars 
shows the first name to be Paul Albino. Will you 
look on the weekly payroll sheets submitted to you 
by Duque & Frazzini, and find Paul Albino? 

A. Here is one right here. 

Q. Just the payroll sheets only. 

A. You are making a segregation between the 
cards and the sheets? 

Q. Iwas asking, Mr. Popovich, if you can show 
the court here how you made the segregation you 
prepared on Schedule No. Il? 

A. We have daily time cards which we used to 
make that schedule. 

Q. You do not have any weekly payrol! sheets 
then to make up Schedule II, is that right? 

A. We have weekly payroll sheets, the original 
weekly payroll sheets, that cover all of Schedule IT, 
but no segregation was used for any of them. We 
don’t have all the time cards here to support all 
of them. 

Q. When you referred to the original payroll 
sheets, you have reference to the master payroll 
sheet prepared by Basich Brothers, do you not? 

A. When I speak of the original payroll sheet, 
I am speaking of the original payroll sheet submit- 
ted to the home office showing a list of all employees 
of Duque & Frazzini, and others, and Basich 
Brothers. 

Q. That is all you have from which you made 
your Schedule No. II of your Bill of Particulars, 
is it? 


388 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich. ) 

A. No, sir, you couldn’t make that schedule 
from these. I have got information to support 
these. What we have to support them are some 
time cards, and some weekly payroll sheets of 
Duque & Frazzini. 

Q. Can you show the court one weekly payroll 
sheet submitted to you by Duque & Frazzini, from 
which you made up any part of Schedule IL? 

A. We don’t have all the information here that 
we used to compile Schedule II. 

Q. Do you have before you in court any weekly 
payroll sheets submitted to the plaintiff by Duque 
& Fragzini from which Schedule No. [1 was pre- 
pared ? 

A. All of the information that we used to pre- 
pare them was taken off of either weekly payroll 
sheets submitted to us by Duque & Frazzini, or 
from time cards presented to us by Duque & 
Frazzini. 

Q. Will you read the question to the witness, 
Mr. Reporter? 


(Record read by the reporter.) 


A. Do you have particular reference to these 
sheets here, sir, these weekly payroll sheets ? 

Q. I only have reference to any payroll sheet 
submitted to you by Duque & Frazzini from which 
Schedule No. IJ was prepared? 

A. We have weekly payroll sheets and we have 
time cards presented to us that were used to com- 
pile all the information set forth in Schedule No. I. 


———— ee _ 


Basich Brothers Construction Co. 389 


(Testimony of George J. Popovich.) 

Q. I will ask you then to examine the time cards 
and the weekly payroll sheet which you used in 
preparing Schedule No. II. 

A. We don’t have all the records here to support 
them. 

The Court: Counsel wants to know if you have 
any weekly sheet. 

Mr. Monteleone: No, I don’t think we have. 

The Court: Let us go on. It is quite evident 
he does not have all the information here. 

Q. (By Mr. McCall): And that is the same 
with reference to the comment we have made on ° 
Schedule No. IL, is it not? If you will refer to 
your comments, Mr. Popovich? 

A. Yes, sir, that is true for No. III. We don’t 
have all the records here with us. 

Q@. And also for No. IV, No V? 

A. We don’t have all the records here for IV 
Oly. 

Q. You do not know whether the things that we 
have pointed out in there are errors or not, is that 
right ? 

A. I have my working papers here, and I have 
checked everything brought out in Schedules IIT, 
TV and V. 

Q@. Can you say from checking that you have 
done whether or not the overpayments we represent 
to have been made in IJ, IU], IV, and V were over- 
payments ? 

A. I say that the payments made for the em- 
ployees were those rates submitted to us by Duque 


390. Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

& Frazzini, and if an employee was borrowed from 
us he was charged the same rate of pay that we 
paid everybody. 

Q. Mr. Popovich, you stated under direct ex- 
amination that you took care of all the insurance 
for Basich Brothers in connection with this job at 
Tueson, is that correct? A. Yes, sir. 

Q. Did you arrange for the compensation in- 
surance ? 

A. Yes, sir, we had a policy in force, and we de- 
posited with that I think approximately $10,000.00. 

@. Do you have that policy in court today? 

Mr. Monteleone: I think the clerk has it. That 
was left with the court, Mr. MeCall. 


Q. (By Mr. McCall): I will ask you, Mr. 
Popovich, if you are familiar with the msurance 
policy of compensation on this job? 

A. I am familiar with it to the extent that we 
were covered for all operations. 

Q. That is Exhibit 19. Can you state to the 
court, without looking at the exhibit, if it contains 
the name of Duque & Frazzini as subcontractors? 

A. Schedule XIX? 

Q. No, Exhibit 19. Mr. Clerk, do you have Ex- 
hibit 19? 


Mr. Monteleone: I think the exhibit speaks for 


itself, Mr. McCall. 
The Court: I think the documents speak for 
themselves. I think it will be conceded that the 


name does not appear. 
“Mr. McCall: All right. 


Basich Brothers Construction Co. 391 


(‘Testimony of George J. Popovich.) 

Q. Beginning with Schedule No. VII of your 
Bill of Particulars, My. Popovich, Equipment 
Rentals, you testified this morning that those sched- 
ules were made uwp—Schedule No. VII was made 
up by equipment time cards signed by each em- 
ployer. 

Mr. Monteleone: Each employee. 

A. By each employee. 


Q@. (By Mr. McCall): And the time cards 
signed by him and the foreman. Do you have in 
court all the time cards making up Schedule No. 
VII? < 

A. I don’t have all the time cards here at all, 
sir. y 

@. Do you have any time cards from which you 
made up Schedule No. VII? | 

A. Not with us here. 

Q. Then beginning with No. VII to No. XLIV, 
all of your testimony with reference to this equip- 
ment being used on the subcontract only was from 
information given to you by someone else, and not 
from your own personal knowledge, was it not? 

A. From the records, sit. 

Q. And from what records? 

A. From books of original entry, paid invoices, 
time cards. | 

Q. When you refer to books of original entry, 
you refer to the record sent to you prepared by 
Basich Brothers on the work, is that right? 

A. The records submitted by them to us, and 


392 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
also records submitted by the office. The job con- 
trols are kept in the home office. 

Q. Then you were never on the job at Tucson, 
the original job, or the subcontract job, were you? 

A. I never was on the job, sir. 

Q. In connection with all of this equipment 
rental, did you have any contract signed by Duque 
& Frazzini, or anyone in their behalf, for the equip- 
ment? 

A. The only record that I have of this particular 
equipment is where Mr. Frazzini called me on the 
telephone and asked me to obtain some for him, 
and I made arrangements, sir, so as to get such as 
the power unit, and various parts that he was un- 
able to obtain, and asked me to get for him. 

Q. That’s the only equipment or supplies that 
you know about of your own knowledge? 

A. That is of direct knowledge, yes, sir. 

Q. In what schedules are those particular items 
covered ? 

A. Well, sir, we have in Schedule—I can give 
you a few here. That schedule calls for equipment 
rentals; that shows Bressi & Bevanda, Industrial 
Equipment Company—that is Sehedule No. XIII. 
Mr. Frazzini asked me to rent this power unit, and 
we made arrangements to do so. 

Also on Schedule XIV, Industrial Equipment 
Company, he has asked me to rent a power unit. 
We also did that. Then we have other items, con- 
sisting of screens used in connection with the Pio- 
neer Crushing plant—this small crushing plant. He 


Basich Brothers Construction Co. 393 


(Testimony of George J. Popevich.) 
was unable to obtain certain supplies or screens, 
and requested me to purchase those for him. 

Q. What schedule is that mentioned in? 

A. That is Schedule—here is the one here, for 
Axman-Miller Construction Company. I rented 
that. That is Schedule No. XXV. 

Schedule No. XX VII, I also purchased various 
sereens for him, and if I am not mistaken this 
belting—he was unable to get conveyor belting. 

Q. So far as you know then there was no written 
agreement between Basich Brothers and Duque & 
Frazzini with reference to the rental of any equip- 
ment whatever, is that right? 

A. That was a written agreement. We have 
had a lot of oral agreements. Do you have reference 
to written agreements ? 

@. Yes. Mr. Popovich, do vou know of any 
written agreement between Basich Brothers Con- 
struction Company, the plaintiff, and Duque & 
Frazzini with reference to the rental of the equip- 
ment mentioned in any of these schedules? 

A. Yes, agreements that were drawn up. I 
would not have any knowledge here, unless the field 
office has knowledge where direct contracts were 
made, but the data that I made—I would talk to 
him on the telephone before shipping the equipment 
over to him. I would ask for his persenal O.K., 
and he would say to ship it either in a truck, or 
by some carrier. 

Q. Outside of these two items, you know noth- 


394 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
ing about any equipment, you testified to this 
morning ? A. Outside of the record. 

Q. I call your attention to Schedule IX, Mr. 
Popovich. Will you look at page 30 of your com- 
ments on the Bill of Particulars. On page 30 of 
the comments on the Bill of Particulars 

A. Page 30, on Schedule IX ? 

Q. With reference to Schedule IX, where the 
following statement is made: . 


‘This Schedule shows royalty charges for 
sand production on the basis of 995 tons. Sched- 
ule XVII shows royalty charges for sand pro- 
duction on the basis of 2,223 tons, a total of 
3,218 tons of sand. The credit allowed for 
sand production in Schedule XXXXIV 
(XLIV), however, is 751 tons of sand.” 


A. Yes, the rental of the Pioneer’ Crushing 
plant and the hot plant was made by Duque & 
Frazzini and Mr. N. L. Basich on royalty leases 
for a sand production basis of 995 tons, on Schedule 
IX. Schedule XVII shows royalty charges for 
sand production on the basis of 2,223 tons, a total 
of 3,218 tons. Of this amount, 751 tons of sand 
was used by us for Seal Coat, and conerete aggre- 
gate, mineral aggregate, of which there was that 
item credited as given in Schedule XXX XIV for 
Seal Coat sand. The other sand was used for min- 
eral aggregate and concrete aggregate. 

®. You stated that you charged a royalty of 10 
cents per ton on the Pioneer Crushing machine, in 
Schedule IX, is that correct? 


Bastch Brothers Construction Co. 395 


(‘Testimony of George J. Popovich.) 

A. On the Pioneer for mineral aggregate. 

Q. That is on Schedule LX of your Bill of Par- 
ticulars ? 

A. According to My. N. L. Basich on an agree- 
ment with Duque & Frazzini, we were to charge 
them 10 cents a ton. -— 

Q. Do you have any place the number of tens 
which you charged them with? 

A. Do you mean the grand total for Pioneer? — 

Q. Yes. 

A. 1 don’t have it. I would have to compute 
that. 

Q. Do you know then where the information was 
gotten from to make that Schedule No. 1X? 

A. From records submitted by our engineers, 
and also our engineers’ computations-with the U. 8. 
engineers’ estimate. 

@. Do you have those records before you? 

A. I don’t have those records. They were com- 
piled—we have those at the office. Our engineers 
would check the others engineers’ records. 

Q. J call your attention to Schedule XXX of 
your Bill of Particulars, Miscellaneous Labor, In- 
voices, and so forth, February 26, 1945, to June 16, 
1945, $2,814.24, and I will ask vou from what in- 
formation did you make this schedule? 

A. Do you mean Schedule XXX? Shall I take 
each cne separately ? 

®. Just state to the court the information from 
which you made up Schedule No. XXX. It says 
‘“Move & Set Up Pioneer.’’ 


396 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

A. Those records were obtained from our time 
cards. 

Q. Do you have them before you in court? 

A. We don’t have all the time cards here, sir. 
They were made up of time cards and weekly pay- 
roll sheets presented to us by Duque & Frazzini. 

Q. You say that Duque & Frazzini submitted to 
you time cards and weekly payroll sheets from 
which you made up Schedule XXX? 

A. Yes, plus—well, I see J. G. North here. We 
also took invoices paid to J. G. North into consid- 
eration, and I notice it says Tucson Machine & 
Engineering. We also took into consideration the 
invoices paid by us. 

Q. Beginning with Item 2/26/45, page 1 of your 
Schedule XXX, in the amount of $33.69, can you 
tell how that labor 1s made up? A. §$33.697 

©. “Yes: 

A. We ean tell that by our time cards, and other 
records we don’t have here available. 

@. Do you have any records available in court 
today from which you made up Schedule No. XXX? 

A. We don’t have all the records here. 

Q. Do you have any of them here? 

A. No, we would have to have our work papers 
to compte that. 

Q. Myr. Popovich, do you know why you left out 
all the names of the men who you have charged to 
Duque & Frazzini on Schedule XXX ? 

A. No reason at all, sir.g We can supply the 
names. 


Basich Brothers Construction Co. 0g 


(Testimony of George J. Popovich.) 

Q. On the other schedules you include the names 
of workmen, but on Schedule XXX, for some rea- 
son they were left out. 

A. -We have no reason at all. 

Q. Asa matter of fact this Schedule XXX was 
all made up of the plaintiff’s own employees, was 
it not? 

A. The plaintiff’s own employees? This was all 
Duque & Frazzini’s employees. 

Q. And plaintiff’s employees were not working 
on Schedule XXX, is that right? 

A. You stated the plaintiffs were not working 
on Schedule XXX. They are all the defendants’ 
employees. 

Q. Will you submit to the court tomorrow morn- 
infi when you return the names of the employees on 
the first page of Schedule XXX? 

A. Yes, sir, we will bring all our records here. 

Mr. Monteleone: Mr. MeCall, there are four 
boxes of them. We will be willing to bring the four 
boxes of daily payroll records. 

Mr. McCall: Of course, we are not asking you 
to do such a job as that, but I would like to see if 
the plaintiff can produce the names of the men mak- 
ing up Schedule XXX, if plaintiff still contends 
they were not his employees. 

A. We will have to go back to the office and 
work on this tonight, and obtain all this information. 

Q. Mr. Popovich, as a matter of fact, this Sched- 
ule XXX, all these items on the first page of 
Schedule XXX were incurred by the plaintiff 


398 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
Basich Brothers Construction Company for the 
setting up of the Pioneer Crusher, were they not? 

A. This was all incurred by Duque & Frazzini. 
These were Duque & Frazzini’s employees, setting 
the crusher up. 

Q. Did you prepare this Schedule XXX your- 
self? A. No, sir. 

Q. Do you know what is mean by ‘‘move & set 
up Pioneer’’? yy eta 

Q. What is meant by ‘‘move—’’ 

Mr. Monteleone: As used in the Bill of Particu- 
lars, is that right? 

Mr. McCall: Yes. 

A. ‘They mean by that, suppose you have vour 
equipment spotted in one place, and you want to 
move it say 200 or 250 feet; that 1s considered a part 
of a move. Setting up means taking two sections 
of the Pioneer plant built together, and setting up 
all the conveyors there, both the primary crusher 
and the roll crusher. 

@. I believe you testified this morning that vou 
prepared the subcontract in this case. 

A. Yes, sir, I did, with Duque & Frazzini. 

@. I eall your attention to Article XXII of the 
subeontract—I beg your pardon, it is Article XII, 
entitled: Completion Work by Contractor, which 
reads in part: 

‘‘TIn the event Basich Brothers Construction 
Co. plant is used, moving in and moving out 
expense will be paid by Basich Brothers Con- 
struction Co.”’ 


Basich Brothers Construction Co. 399 


(Testimony of George J. Popovich.) 

A. He talked with My. Basich in regard to that 
matter. I was present. 

Mr. McCall: I move that the answer be stricken 
as not responsive to the question. 

The Court: You had better answer the question. 

Mr. McCall: Will you read the question to him, 
please? 


(Question read by the reporter.) 


A. By that we meant the cost of transporting 
the equipment from Alhambra to Tucson, and back, 
was to be paid by Basich Brothers Construction 
Company. 

Q. I eall your attention, Mr. Popovich, to your 
Schedule XXAVI. 

A. Yes, sir. On Schedule XXXVI the insur- 
ance charge was computed as follows: Computation 
per 100, by Code 5546, was $4.60; Federal and Ari- 
zona Unemployment Insurance Excise Tax, $4.00; 
a total of $8.67 per hundred. No charge was made 
for public hability and property damage, because 
the truck drivers are insured under the truck own- 
er’s contract policy, and therefore P.L. and P. D. 
was not charged. 

@. You did have P.L. and P.D. charged until 
vou received this statement which we are looking at 
now, did vou not? 

A. What statement did you have reference to, 
sir? 

Q. Comments on the Bill of Particulars. 

A. On your Bill of Particulars you state: 


400 Glens Falls Indemmuty Co. vs. 


(Testimony of George J. Popovich.) 
‘Plaintiff has not exhibited to defendant evidence 
of authority for the rating used in computing 
Workmen’s Compensation Charges.’’ I notice the 
charge on insurance on labor is $2103.75 at 8.67 per 
100. If I understand you correctly, I just give you 
the breakdown of how we arrived at of $8.67 per 100. 
@. On Schedule No. XXX Vi—do you have that 


before you? A. Yes. 
Q. Date 6-7-45, Move & Set Up P.D.O.C. plant, 
2,000.00, invoice. AS Yes) cir 


@. Was this ordered by Duque & Frazzini? 

A. Ihave no knowledge of that, sir. Our records 
show that the invoice shows $2,500.00 charged and 
chargeable to Duque & Frazzini. 

G@. Do you have any other information on that 
&2,500.90, in a breakdown other than invoice? 


4 mr 


A. Mr. N. L. Basich made the deal on that. 
@. You have no personal knowledge about it? 
A. No, I just have what we paid him, and it was 
charged accordingly, per our records. 

Q@. Then I call your attention to Schedule 
NANXTX. Do you have that Schedule XX XIX of 
your Bill of Particulars before vou? 

B. Yessir. 

@. Do you have the defendant’s comments on 
page 36 before you, Mr. Popovich? 

A. Yes, sir. 

Q. Will you read Article X XII, Item 11, of the 
alleged subcontract ? 

A. Under what schedule? 

@. This is under Schedule XX XIX. 

A. All right. 


Basich Brothers Construction Co. 491 


(Testimony of George J. Popovich.) 

Q. No. XX XIX. Then I call your attention to 
subcontract, Item 11, Article XXIII, which reads 
in part: ‘‘Measurement to be computed on truck 
water level.”” Then in your schedule you have 
‘‘Measure for purposes of credit to Duque & Fraz- 
zini is made by this schedule dividing square yards 
in place by 15.”’ Can you tell the court why Sched- 
ule XX XIX does not give credit according to Item 
11, Article X XIIT of the subcontract? 

A. To vertify these figures in Schedule XX XIX, 
they were made up by our engineers using quanti- 
ties, and also checking the engineers’ measurement, 
that is, the P.D.O.C. estimate, and of Mr. N. L. 
Basich. Mr. Mitchell is the engineer. The P.D.O.C. 
estimate was used to compile these figures. 

Q. I call your attention to Article XXIII of the 
subcontract, and Item 11, which provides that the 
measurements will be computed on truck water 
level, and Schedule XX XIX shows that the compu- 
tation was on square yards. Can you tell why that 
was changed? 

A. Mi. N. L. Basich will tell. I do not know 
why it was changed. 

Nene McCall: “Wags ts all. 


Redirect Examination 
By Mr. Monteleone: 

Q@. Mr. Popovich, in preparing your Bill of 
Particulars you stated that you had used daily pay- 
roll records that were furnished to you by Duque & 
Frazzini, and also weekly payroll records. Now, 


402 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 
did you duplicate the daily and weekly in arriving 
at it, or did you segregate each one? 

A. We segregated each one, and took them into 
consideration so no double payment would result. 

@. How many boxes of dailv payroll records do 
you have in connection with the Duque & Frazzini 
job? 

A. Homer Thompson, my office man, bunched 
them all together. JI imagine there are three or 
four there. 

@. During the investigation were those records 
shown to the auditor of the Glens Falls Indemnity 
Company ? 

A. Yes, they were available to him. He spent 
several weeks in our office. We gave him every- 
thing he asked for. 

Q. With reference to Workmen’s Compensation 
policy, I understand you had a discussion with Mr. 
Hrazzini before the subcontract was signed? 

OS: 

Q. If Duque & Frazzini had to make their own 
Workmen’s Compensation payment, would they 
have been required to make a deposit with the State? 

A. Yes. 

Q. But you already had taken care of that for 
him ? A. Yes, we deposited $10,000.00. 

@. That was previous to this time? 

A. Yes, and Mr. Hutchinson, the auditor, veri- 
fied the record; went over it with our office, and 
also with Homer Thompson. 

Q. So you were saving money and expense to 


Basich Brothers Construction Co. 403 


(Testimony of George J. Popovich.) 
Duque & Frazzini by accommodating them with the 
Workmen‘s Compensation ? 
Mr. McCall: I object to that as calling for a 
conclusion. 
The Court: Overruled. 


Q. (By Mr. Monteleone): Is that a fact? 

A. Yes, that was in accordance with our agree- 
ment under the contract. 

Q. You were helping them out and saving them 
money by doing so, is that right? 

A. Yes; it was mentioned that they were unable 
to take care of labor and insurance, and asked us 
to do it. So far as the other items are concerned, 
they said they were financially competent to do that. 
That was the reason we inserted the special provi- 
sion about labor and all the insurance. 

Q. Had they been required to pay their own 
workmen’s compensation, would the State have re- 
quired them to make a deposit? 

A. They always required it of us and foreign 
companies, who had never worked in Arizona before. 

Q. Who paid that deposit? 

A. We paid the $10,000.00. 

Q. Mr. Popovich, was it customary among con- 
tractors in construction work for the general con- 
tractor to procure supplies or equipment for the 
subcontractor, and then charge the same against the 
subcontractor ? 

A. Yes, that is done quite frequently. It is 
purely an accommodation extended to them. 


404 Glens Falls Indemnity Co. vs. 


(Testimony of George J. Popovich.) 

Q. In connection with Schedule X-XX, in con- 
nection with moving in and moving out of the Pio- 
neer plant, did you make any charge in the Bill of 
Particulars for the expense of moving in and mov- 
ing out the Pioneer plant? A, No 

Q. When you referred to moving the Pioneer 
plant, in your Bill of Particulars, what expense 
were you referring to? 

A. Miscellaneous moving, and assembling the 
whole plant. We brought the plant in in several 
truck loads, and put the plant mn one place. They 
eereed to go ahead and move it around, and adjust 
it, and assemble 1t. That is called moving and set- 
up. That is a general term used in construction. 

Q. In other words, during the operations of 
Duque & Frazzini this plant has been moved from 
one point to the other point, and put up again? 

A. Yes. 

@. The items referred to in that Bill of Par- 
ticulars have reference in connection with charges 
by Duque & Frazzini in conection with their opera- 
tions? A. That’s right. 

Myr. Monteleone: That is all. 

Mr. MeCall: No further questions. 

Mr. Monteleone: Mi. McCall, do you want us 
to bring in the payroll records tomorrow ? 

Mr. McCall: I am not stating to the plaintiff 
what records to show. 

The Court: I think to be safe, in order to make 
my ruling correct, you should bring in everything 
that you have. If you have a truck load, I will give 


Basich Brothers Construction Co. 405 


(Testimony of George J. Popovich.) 

you special permission to bring them in here. If 
you can show that you have them here, then the rule 
is complied with. 

Mr. Monteleone: We will bring them in_ to- 
morrow. 

The Court: I am doing that to save Mr. McCall 
the embarrassment of having to stipulate to any- 
thing he might not wish to, and that is In no way a 
criticism. 


(Whereupon, an adjournment was taken 
until Wednesday, February 5, 1947, at 10:00 
o’clock a.m.) 


Los Angeles, California 
Wednesday, February 5, 1947, 10:00 a.m. 


Mr. Monieleone: May the record show, if the 
Court please, that the plaintiff has bronght into 
court eight boxes of records kept by the plaintiff in 
connection with this particular job involved, to 
which the witness George Popovich referred in his 
testimony vesterday, and that they are available to 
the court or to the defendant. 

The Court: All right. 

Mr. McCall: May it please the court, to clarify 
the position of the defendant, and possibly save 
more time, it is net our position that the payments 
alleged here were not made. It is only our pesition 
that the defendant is not hable for the amounts 
paid for various reasons, which we have shown, or 
ean show. We admit they made payments, but, 


406 Glens Falls Indemnity Co. vs. 


because they were premature, and for other reasons 
the defendant is not lable. 

The Court: You have required them to meet the 
burden of showing they actually made them, in 
addition to the proof, which has taken a full day. 
Now, they may as well complete whatever showing 
they desire to make. Had you admitted they were 
made, and merely questioned the validitv, we would 
have saved a day yesterday. I don’t think there is 
an admission in the record. This case, unfortun- 
ately, because it went before three judges, left the 
record in an unsatisfactory fashion. When I econ- 
clude the taking of the testimony that will be the 
end, and it will not be reopened by me. In other 
words, there will not be one item as to which there 
is no stipulation, or as to which proof does not exist 
in the record. Proceed with your proof. 


BART C. WOOLUMS 
called as a witness by and on behalf of the plaintiff, 
having been first duly sworn, was examined and 
testified as follows: 


The Clerk: What is your name, please? 
A. Bart C. Woolums. 


Direct Examination 
By Mr. Monteleone: 
Mr. Woolums, where do you reside ? 
Los Angeles. 
What is your business or occupation ? 
Construction superintendent. 


> OPS 


Basitch Brothers Construction Co. 407 


(Testimony of Bart C. Woolums.) 

Q. Were you connected in any way with the 
construction of the Davis-Monthan Air Base near 
Tueson ? 

A. Yes, I represented the government as the 
resident engineer. 

Q. During what period of time did you repre- 
sent the government in that capacity? 

A. About five years. 

Q. Commencing when, up to what time? 

A. I started in 1941 and finished in 1946. 

Q. What was the nature of that construction 
work ? A. At Tueson, do you mean? 

Q. Yes. 

A. It was paving runways, drainage. 

Q. What was the general purpose of that con- 
struction? For what was it to be used? 

A. To strengthen the runways for the larger 
bombers. 

Q. While you were there did you come to know 
Mr. Carson Frazzini, and Mr. Duque, his partner? 

A. Yes, I met the gentlemen. 

Q. Mr. George Popovich? A. Yes, 

Q. And N. L. Basich? A. Yes. 

Q. Did you have occasion to visit the pit site 
where the material was being produced, during the 
year 1945, for this bomber base? A. Yes. 

Q. How often did you visit the site? 

A. I imagine once every day. 

Q. In his deposition, Mr. Carson Frazzini made 
a statement that you and Mr. Popovich, about May 
19 ordered that he not remove material from a cer- 


408 Glens Falls Indennity Co. vs. 


(Testimony of Bart C. Woolums.) 

tain site that he was prospecting. Bearing that in 
mind, do you recall haying been at the pit site about 
that time? A. Wes, Sil. 

Q. Who asere present at the™time? 

A. Well, Afr. Gollobs. 

Q. Who is Mr. Gollobs? 

A. Mx. Gollobs is the owner of the pit, of the 
property. George Kovick and Harold Sloniger, and 
myself. 

Q. Who is Mr. Sloniger? 

A. Mr. Sloniger represented me in the field. 

Q. Was Mr. Duque or Mr. Frazzini there? Were 
they present also at the time? A. Yes, si. 

Q@. Was Mr. Kovick there? 

A. Sir -ikowick was tlvere. 

Q@. State what was said or done at that time in 
connection with that matter? 

A. I was called down, due to the scarcity of 
material. The Basich Construction Company had 
to find more material. J say they had to find more 
material, because they were the general contractor, 
and Duque & Frazzini were the subcontractors, over 
which | have no control. 

Mr. Gollobs had a house practically built on the 
highway, and thev had already, in years previous, 
had a pit at the site of his property, running 
parallel to the back of it. I remember this par- 
ticular day I was called down, and Duque & Fraz- 
zini wanted to turn abruptly, and go behind the 
man’s barn and his house, to get the material. 


Basich Brothers Construction Co. 409 


(Testimony of Bart C. Woolums. ) 

Mr. Gollobs said to me—in years previous I had 
contacted him, and he told me he would help the 
government in any way he could to produce material 
for the runways for the Davis-Monthan Field. He 
said, ‘‘I would rather they tear up my back yard, 
and not my house.’’ I agreed with him that the 
man had done everything in his power to help the 
government, and also the contractors, and I don’t 
see how he could allow them to destroy his home. 

Mr. McCall: I object to that, may it please the 
Court, as assuming a fact not in evidence. "There is 
no evidence before the court that they were trying 
to destroy the man’s back yard. 

Mr. Monteleone: This is what you told Mr. 
Frazzini at the time, as said by Mr. Gollobs? 

A. That’s right. I said as far as my part, rep- 
resenting the government, I have no part in it. 

The Court: Objection overruled. 


Q. (By Mr. Monteleone): Did Mr. Kovick 
make any comment at the time that you recall? 

A. My. Kovick said that he was of about the 
same opinion. There were other materials avail- 
able, which were further away. 

Q. Did you or Mr. Kovick tell Mr. Frazzini, or 
Mr. Duque, that they could not remove material 
from the site where they were standing—remove the 


material ? A. No, sir. 
Q. The only one who objected to that was Mr. 
Gollobs, is that correct? A. ‘That’s right. 


Q. In connection with the measurement of ma- 


410 Glens Falls Indemnity Co. vs. 


(Testimony of Bart C. Woolums.) 

terial used in connection with this government job, 
was that under your general supervision, in deter- 
mining the quantity? 

A. Yes, sir, to make payments for the govern- 
ment, we had to take a field party to the cross sec- 
tions and compute it for quantity. 

@. How was that done? 

A. I had my field party. They went out and 
took all the necessary measurements, and came back 
to ny office, and turned it over to my office engineer. 
He would compute the quantities which we would 
submit to the general contractor. 

@. Did the general contractor also have an engi- 
neer to make their own computations? 

Ne ces 

Q. Were these computations made in the ordi- 
nary course of business? A. Yes. 

Q@. From your observation, and your super- 
vision, were they accurately made, so far as humanly 
possible ? A. Yes. 

@. They were made in the regular manner of 
making measurements, is that correct? 

ee 

Q. While you were at the pit, during the progress 
of the work, did you ever hear George Kovick, or 
anyone connected with Basich Brothers, ever give 
Duque & Frazzini orders, or direct how they should 
operate their plant, or their operations? 

A. No, sir; that was none of my business. 

Mr. Monteleone: That is all. 


Basich Brothers Construction Co. 411 
(Testimony of Bart C. Woolums. ) 
Cross-Examination 
By Mr. McCall: 


Q. Would the reporter please read the last ques- 
tion counsel asked, and the answer? 


(Record read by the reporter.) 


Mr. Woolums, were you at the pit on the 19th 
day of May, 1945? A. Yessir, 

Q. What time were you at the pit on that day? 

A. I would say it was about 11:00 o’clock. 

Q. Was Mr. Kovick and Mr. Albino present at 
that time ? 

A. Albino, no, sir. My. Kovick was. 

Q. Did vou hear Mi. Kovick countermand the 
order to Mr. Frazzini, and instruct the men to go 
back to work on the Pioneer Crusher? 

A. No, sir. 

Q. You do not know whether he did that on the 
19th of May or not? 

A. I ecouldn’t tell vou. 

Q. What were vou doing at the pit on the 19th 
of May, about 11:00 o’clock? 

A. Mr. Gollob sent my inspector after me, and 
wanted to explain to me why he could not allow 
them to use this particulary material, because two 
vears previous I went to Mr. Gollobs and had him 
give the contractors, previous to this job, permission 
to use his materials. Naturally, he looked to me for 
someone to tell his troubles to. 


412 Glens Falls Indemnity Co. vs. 


(Testimony of Bart C. Woolums. ) 

Q. Did he tell you that Duque & Frazzini wanted 
to move the plant over closer to his house? 

A. It was not a case of plant moving; just a 
ease of taking materials. 

Q. How did they go about taking materials, by 
truck or shovel? A. Shovels and trucks. 

@. Had they moved the shovels and trucks and 
started taking the material closer to his house? 

A. Well, I think the shovel was across the street. 
It’s impossible to say, because 1 don’t keep that 
much of a record of it. 

Q. How far was the gravel that you understood 
they wanted to take from his house? 

A. How far was it from where? 

Q. EFrom Mr. Gollobs’ house? 

A. It would run right up to within 50 feet of 
his house. 

Q. Who told you it would run up that close? 

A. Because as I said previously, with two years’ 
experience I knew the pit pretty well. That was 
the only place to take that material from behind his 
house. We had stopped the previous contractors 
from going back behind his property. They had to 
run paralle] with the river. 

Q. Was My. Duque, or Mr. Frazzini there that 
morning ? A. Which morning was that? 
May 19th, the time vou are talking about. 
Mr. Frazzini was there. 

He was there at the time you were there? 
Yes. 
‘That was about 11:00 o’clock? 


OPOore 


Bastch Brothers Construction Co. 413 


(Testimony of Bart C. Woolums.) 

A. I would say it was, in the morning, yes. 

Q. Had the Pioneer plant shut down at that 
time? A. That I don’t know. 

Q. Were you at the Pioneer plant? 

A. The Pioneer plant was sitting at the pit, but 
that was none of my jurisdiction. 

Q. Was it operating at that time? 

A. That I couldn’t say. 

Q. Did you hear any dispute between Mr. Fraz- 
zini and Mr. Kovick about whether or not the Pio- 
neer plant would continue to run that day? 

A. No, sir. 

Q. Mr. Woolums, can you state to the court now 
definitely that Mr. Frazzini was at the pit on Satur- 
day morning, May 19, 1945, when you say you were 
there ? 

A. Well, I can’t quote dates, because I took no 
record of the date; but, as I said previously, we had 
this meeting on or about that time. 

@. You say you were in the pit on an average 
of once a day while you were on the job? 

A. Yes, sir. 

Q. What were you doing in the pit once a day? 

A. I supervised all the construction. I went 
down to contact my two field men. I had two field 
inspectors inspecting the material; how it was 
erushed; how it was delivered. 

Q. When was the first dav that you went to 
the pit? 

A. I went to the pit every day of the job. 

Q@. When did the job start? 

A. I can’t give you the correct date. 


414 Glens Falls Indemnity Co. vs. 


(Testimony of Bart C. Woolums. ) 

Q. Just approximately, according to your recol- 
lection. 

A. It must have started sometime in February 
or March. I couldn’t tell you without looking it up. 

Q. In 1945? Do you know what date in Feb- 
ruary or March, 1945, the first material was pro- 
duced ? A. No, sir. 

Q. And every day that you were in the pit, did 


you see Mr. Kovick? A. Nomen 
Q. Did you ever see him in the pit? 
A. Yes, sir. 


Q. How often? 

A. Off and on at intervals I would happen to 
meet him, or I wouldn’t happen to meet him—lI 
might be down there, or he might be up in the field. 

Q. Were you in the pit at any particular time 
of the day each day? 

A. No; whenever it was my convenience to go 
down. 

Q. Did you ever see the subcontract between 
Basich Brothers Construction Company and Duque 
& Frazzini? A. No, sir. 

Q. You know nothing about that. 

A. I know nothing about it. 

Mr. McCall: That is all. 


Basich Brothers Construction Co. 415 
(Testimony of Bart C. Woolums.) 


Redirect I!xamination 
By Mr. Monteleone: 

Q. Mr. Woolums, do you recall writing a letter 
to Basiech Brothers, dated June 7, 1945, a eopy of 
which has been introduced im evidenee in this mat- 
ter, in reference to the production of material? 

Mr. McCall: We will stipulate that the letter 
that plaintiff has, purporting to be from Mr. 
Wooliuns, as an exhibit, was from him. 


Q. (By Mr. Monteleone): Do you recall writ- 
ing that letter? 

A. Yes, I believe I wrote three or four letters 
to Basich Brothers. 

Q. This one is dated—may I refer to my copy, 
Mi. MeCall? It is an exact copy. 

Mr. MeCall: No objection. 


Q. (Br Mr. Monteleone): I show vou what 
appears to be a copy of a letter dated June 7, 1945, 
to Basich Brothers Construction Company, atten- 
tion Mr. G. W. Kovick, and at the bottom signed 
B. C. Woolums, resident engineer, and ask you to 
elance over that letter. A. ‘Yes, soir. 

Q. To the best of vour knowledge were the state- 
ments made in this letter correct and accurate facts? 

A. We kept a daily log of everything, and we 
wrote these letters from our office records. 

Q. To the best of yon knowledge, the facts 
were correctely stated in that? m. Yes. 

Mr. Monteleone: That is all. 

Mr. McCall: No further questions. 


416 Glens Falls Indemmty Co. vs. 
Mr. Monteleone: Mr. Basich, take the stand. 


NICKOLA L. BASICH 
called as a witness by and on behalf of the plaintiffs, 
having been first duly sworn, was examined and 
testified as follows: 


Direct Examination 
By Mr. Monteleone: 


@. Mr. Basich, yon are a party, who gave your 
deposition in connection with this matter, which has 
heretofore been filed, is that correct ? A. Yes. 

Q. I will try and not ask you any questions in 
connection with matters covered by your deposition, 
but in connection with other matters. When Mr. 
Frazzini came to your office, shortly prior to sign- 
ing the contract of February 7, 1945, did you have 
any discussion with him about this man Paul 
Albino ? A. Yes. 

Q. State what was said in connection with it 
at that time. 

A. Yes, we talked about Albino. We told him 
we had the plant, and we were willing to pay freight 
and back. 

Q. What plant are you referring to? 

A. The Pioneer. Pav the freight forth and back, 
free of charge. for him to take care of everything at 
a reasonable rate. I told him this plant cost 
$40,000.00, and I would like to have a good experi- 
enced man to run it, a very good one. He says, 
“*T don’t have any.’’ 


Basich Brothers Construction Co. 417 


(Testimony of Nickola L. Basich.) 

I told him, ‘‘We have a man that ran this plant 
off and en. I would like to have him on the plant 
if it is possible, if he is available.”’ 

He told me, he said, ‘‘I will be glad to have him, 
because we haven’t got anybody.”’ 

Q. At that time was Paul Albino in your 


einploy? A. No. 
Q. Was he on your payroll at that time? 
A. No. 


Q. Later on, after the contract was signed be- 
tween vou and Duque & Frazzini, did Frazzino have 
any further conversation with you concerning Paul 
Albino? 

A. Yes, I think about the 3rd or 4th of Feb- 
ruary Mr. Frazzini asked me if I got in touch with 
Mr. Albino; if he was available. 

Q. What did vou tell him? 

A. I told him we located through our Social 
Security where he was, and we wrote him a letter, 
but we have not got an answer at that time. 

Q. Did you at any time tell Mr. Frazzini or Mr. 
Duque that they could not rent this Pioneer plant 
from you until they hired Mr. Albino? 

A. No. 

Q. Did you at any time. while Albino was work- 
ing in connection with the operations of Duque & 
Frazzini, give Albino, or anyone else, any orders or 
directions ? A. No. 

Q. Do you know of your own knowledge whether 
anybody connected with the Basich Brothers ever 
gave Albino any directions as to how to operate that 


418 Glens Falls Indemnity Co. vs. 


(Testimony of Nickola L. Basich.) 
plant while he was working for Duque & Frazzini? 

A. No. 

Q. Did Basich Brothers have anyone, while the 
Pioneer plant was being operated by Albino, to 
supervise those operations? A. No 

Q. I understand you and Duque & Frazzini 
agreed upon a rental basis of 10 cents a ton, is that 
correct? A. Yes. 

Q. What did the Pioneer plant consist of when 
this arrangement of 10 cents a ton was entered 
into? 

A. It consisted of the plant itself, which con- 
sisted of the crusher, 10 by 36, rolls 20 by 48; 
screens, bins, and all odds and ends; feed convevor, 
that feeds the plant, return conveyor, finished prod- 
ucts conveyor, and waste conveyor, and a bunker. 

Q. Did Duque & Frazzini later on rent from 
Basich Brothers any additional bins and screens? 

i VOR. 

@. That was a separate transaction? 

i Veet 

Q. What was the condition of this Pioneer 
plant when it was first turned over to Duque & 
Frazzini, so far as rolls and other parts were con- 
cerned ? A. Completely built. 

Q. In good condition? A. A-l. 

Q. Later on there were repairs and _ replace- 
ments put on the Pioneer plant while it was heing 
operated in the production of materials as specified 
in the subcontract of date February 7, 1945, which 


Bastch Brothers Construction Co. 419 


(Testimony of Nickola L. Basich.) 
it set forth in the bill of particulars. Are you 
familiar with those items? i, WAG: 

Q. In your opinion were those repairs and re- 
placements made necessary by reason of this opera- 
tion in producing this material ? Ay Ves 

Q. In your opinion were the charges made rea- 
sonable charges for these repairs? A. Yes. 

Q. In connection with the rollers or crushers, 
what effect did the operation have on that matter? 

A. The roller crusher and jar crusher is used 
in the making of little rocks out of big ones. They 
wear out. The crusher consists of rolls, one roller 
corrugated, and one is flat, and every couple of 
weeks after they are new, or three weeks, it all 
depends on the hardness of the rock, you have got 
to build them up, or put in new rolls, because they 
become cut and smooth, and they won’t erush. 

Q. In connection with the Bill of Particulars 
it shows that during the course of time that material 
was being produced, as specified in the subcontract 
of February 7, 1945, continuing even after Duque 
& Frazzini left the job. Were these repairs and 
replacements therein specified necessary in order 
to produce the materials so specified mm the sub- 
contract ? 

A. Yes, they were more necessary than before, 
because the plant was worn out, and required some 
more repairs. 

Q. That condition was brought on by reason of 
the operation in producing this material, which re- 
quired repairs? A. That’s right. 


422 Glens Falls Indemnity Co. vs. 


(Testimony of Niekola L. Basich.) 


Q. Were those—any of those used by Duque & 
Frazzini in connection with their operations? 


A. Yes. 


Q. Following that, after Duque & Frazzii 
pulled off the job, on or about June 8, 1945, the 
Bill of Particulars shows a hst of expenses ineurred 
in connection with the production of materials set 
forth in the subcontract of February 7, 1945, con- 
sisting of rental of equipments and other items, 
repair of equipments. Were those items so speci- 
fied, in vour opinion reasonably necessary in order 
to produce the material? A. Yes. 

@. Were they actually used m the production 
of this material ? Acs 

(). In vour opinion were those expenses reason- 
able charges? AL Nes: 

Q@. Mr. Basich, after Duque & Frazzini ceased 
to produce material, and vou produced material, 
were vou able to buy material from anv source, to 
take the place of the material specified in the sub- 
contract, at a cheaper amount than it cost to produce 
it as shown in the Bill of Particulars? 

A. No. we tried to get products. They were sky 
high. I am sure we tried. The first trip of Mr. Bray 
in Tueson, I told him what the material cost us 
brought in from the outside. 

©. In other words, your operation was cheaper 
than you could purchase material? A. Yes. 


@. Were you able to arrange for the production 


Basich Brothers Construction Co. 423 


(Testimony of Nickola L. Basich.) 
of that material through any other means, aside 
from the means you adopted? 

A. Not for the same cost. 

Q. in other words, it would have cost you more 
to make other arrangements, is that correct? 

A. Yes. 

Q. Can you explain why it is that the Bill of 
Particulars shows that the cost amounted to more 
than the amount of production? 

A. On the operations from June 9th? 

Q. Yes. 

A. In the first place, the plant was worn out, 
and you can check through the Bill of Particulars 
and see it takes more parts for the plant, for up- 
keep, and more money for upkeep, and a less pro- 
duction. 

Second, when Duque & Frazzini pulled off they 
left us high and dry. We had to get the equipment 
there. You can see in the Bill of Particulars we paid 
171% cents truck measure for the P.D.O.C. plant, 
and our plant, the Pioneer, we charged 10 cents a 
ton. In the P.D.0.C. plant there is rock, dirt, and 
sand, whatever comes. It was measured. On the 
Pioneer plant there was nothing but pure rock to 
be crushed. 

Q. In your opinion were the operations carried 
on after Duque & Frazzini pulled ont in as efficient 
and economical manner as it was physically possthle 
to do so? 

A. The best that could be done. 


424 Glens Falls Indemnity Co. vs. 


(Testimony of Nickola L. Basich.) 

Q. What happened when Duque & Frazzini 
pulled off of that job, Mr. Basich? 

A. I wasnt that day on the Web: 

Q. Did they talk to vou before they pulled off 
the job? A. No. 

Q. Did they remove all of their equipment from 
the job? 

A. All of the equipment, except two electric 
motors, which were operating the screens, on the 
Pioneer plant. 

Q. Going back to this Pioneer plant that you 
installed, had vou discussed the matter with Duque 
& Frazzini and Mr. Bray, the Glens Falls agent? 

A. The only time I discussed Duque & Frazzini 
was when I made the contract. 

Q. I don’t mean the Pioneer plant; I mean the 
P.D.O.C. plant? 

A. Yes, sir, we discussed that the early part of 
May. 

@. With whom? 

A. Mr. Bray, My. Frazzmi, Mr. Duque, Eddie 


Q@. Who was Eddie Earl? 

A. P.D.O.C.; and Mr. Kovich. Mr. Bray came 
im Tueson in the early part of May. He stopped at 
the Pioneer Hotel. I was staving at the Santa 
Rita. He called me. I asked Mr. Brav to come 
and have breakfast with me at the Santa Rita, 
which he did. He asked me if I was going out. I 
said yes, but I have no transportation, so he 
took me. 


Basich Brothers Construction Co. 495 


(‘Testimony of Nickola L. Basich.) 

He took in Duque & Frazzini’s office there, and 
later on he came into our office. He asked all the 
questions about the cost, and everything, which If 
told him just exactly what it was; that the cost 
is exceeding their production, and Mr. Bray and 
Homer Thompson, 1 am sure they spent two or 
three hours looking things over there. Mr. Bray 
stayed a couple of days. I told Mr. Bray, ‘‘Why 
don’t you set up a plant? It is impossible for them 
to supply the material and finish the job in time, 
which was very urgent with the B 49 Base. 

He asked me what could be done. He asked me 
if there was a plant in the neighborhood that could 
be got. I told him about the P.D.O.C. plant. He 
talked to Duqne & Frazzini. He came back again, 
and he said to me, ‘* Nick, they can continue with 
the work where they are. They owe avound 
$20,000.00 worth of bills, and they haven't got the 
money to pay them.”’ 

Q. Who told you that? 

A. Mr. Bray. Then he asked if I couldn’t ad- 
vance them $20,000.00 so that they could proceed 
and finish the job. I told Mr. Bray, ‘‘No, I ean’t 
advance the money. but TE can rent them the plant 
and charge them, if satisfactory.’’ So we checked 
in and got prices from Eddie Earl. 

I don’t think Bray was at the meeting at our 
office when Eddie Earl came. Then Duque & Fraz- 
zini came. | was there about an hour and a half. 
They gave us some prices, and when I left they 
were still talking. 


426 Glens Falls Indemnity Co. vs. 


(Testimony of Nickola L. Basich.) 

When I got in the hotel I had my dinner. About 
11:00 o’clock George called me up—George Kovick, 
and said, ‘‘Nick, when we left the office I tried to 
eall you up, but I couldn’t get vou; vour room did 
not answer. Later on, just a few minutes ago, Mr. 
Duque called, and he said, ‘Yes, we will take that 
plant if vou pay for the moving in and out, 
$2,500.00.’ ”’ 

ft told George to call Duque and tell him I am 
not going to pay anything of the kind; it is up to 
them to produce the material, and get sufficient 
eqtipment to do so. 

@. Later on Basich Brothers made arrange- 
ments with P.D.O.C. for that plant? 

A. Some arrangements. 

Q. When was that plant put in operation, the 
P.D.0.C. plant? 

A. The first part of June, around the 5th to the 
Sth; something like that. 

@. At that time had Duque & Frazzini been 
producing sufficient material for you to carry on 
vour operations at the main base? A. No. 

Q. Were vou compelled to suspend vour opera- 
tions at anv time at the main base because of lack 
of material being produced by Duque & Frazzim? 

A. Yes. 

Q. Do vou know whether or not there were 
available material on the Gollobs property, aside 
from any material back of his barn, that could 
have been produced to carry on operations? 


Basich Brothers Construction Co. 497 


(Testimony of Nickola L. Basich.) 

A. Sure, there was enough to supply another 
base like that. 

Q. Did you take any material at the spot indi- 
cated by Mr. Wollums in his testimony, where he 
stated Duque & FHrazzini wanted to move the 
material? A. No, I couldn’t. 

@. Did you? A. No. 

Q. Did you have any arrangement, or discus- 
sion, with Mr. Duque or Mr. Frazzini as to where 
he should not remove any material, before the con- 
tract was signed? nes. 

Q@. What was said in that respect? 

A. Mr. Frazzini came on the job first, which 
was around the 10th or 11th, whatever it was. I was 
on the job, and I took Mr. Frazzini on the property 
owned by Mr. Gollobs, and told him how far he 
could go close to the house. There was a previous 
pit in there showing good rock on that side next 
to the house, which Mr. Gollobs would not let me 
touch, and when he leased it he showed me how far 
I could go to get material. So I took Mr. Frazzini 
and showed him exactly the lines where Mr. Gollobs 
agreed to let me have it. I told him he can’t go 
outside of those lines. 

Q. Was the point where Duque & Frazzini were 
planning to remove the material about May, 1945, 
beyond the line indieated ? A. 150 feet. 

Q. Beyond that tine? ey (res wel, 

Q. Mr. Basich, have you had numerous confer- 
ences with Mr. John Bray of Glens Falls Indemnity 
Company, while Duque & Frazzini were operating? 


428 Glens Falls Indemnity Co. vs. 


(Testimony of Nickola L. Basich.) 

A. I think that is in the deposition, except one 
time. 

Q. You have to testify? 

A. Yes, except one time Mr. Bray came in our 
office. 

Q. When was that? 

A. Oh, that was between the 20th and the Ist 
of May. 

@. The 15th or 20th of April? 

A. And the Ist of May. Sometime in April. 
IT don’t know the time. He called up and wanted 
to come and talk to me about it, after he received 
the letter. 

@. He came to your office? A. Yes. 

@. What discussion did you have? 

A. He asked me how things were going out 
there. I told hin what f£ thought, and told him the 
best thing for them was to do something about it. 
He promised me he was going to take a look 
aE Tne 

Q. After vou had this meeting at your office, 
did vou meet Mr. Bray at Tucson? A. Yes. 

Q. How many davs did he spend there? 

A. Two or three days. It’s in the deposition. 


(Short recess. ) 


Q. (By Mr. Monteleone): My. Basich, durmg 
the operations of Duque & Frazzini did you or 
anyone connected with Basich Brothers, to your 
knowledge, ever hire or fire any of the men working 
on the Duque & Frazzini operations? A. No. 


Basich Brothers Consiruction Co. 499 


(Testimony of Nickola L. Basich.) 

Q. Or did you, or any of your men, make apy 
attempt to hire or fire any of these men? 

A. No. 

Q. Referring to Article XXIII, Item 11 of the 
subcontract of date February 7, 1945, Plaintiff’s 
Exhibit 1, it is specified therein, 9,000 cubie vards 
of gravel for stabilized sub-grade under gravel base. 
It is already stated that measurements are to be 
eomputed on truck water level. Do you remember 
that provision ? A. Yes. 

®. The measurements, so far as the Bill of Par- 
ticulars shows, are according to cubic yards? 

A. Yes. 

Q. Will vou state why it was measurement was 
made in connection with this item on the basis of 
eubic yards rather than truck water level? 

A. Truck water level means the truck full of 
material. In the bunker you have a hole 12 inches 
by 12 inches, and you load the trucks which have 
a body consisting of 6 feet in width up to 7 feet 
in width, and a difference in length, and when vou 
dump it in the middle vou can have water level. 
So vou have to have two men level the trucks un, 
and he has got to make a truck full, and for every 
truck full he gets paid for it, and Duque & Fraz- 
zini, they did not want to do it; they did not like 
to do it; and he asked could they be paid any 
other way. I told him yes, he could be paid the 
other way. The specifications call for 2 inches thick, 
which would be a benefit to him. There was more 
waste with 2 inches thick lying loose on the ground 


430 Glens Falls Indemmty Co. vs. 


(Testimony of Niekola L. Basich.) 

than in the truck. Therefore. he gets the henefit 
of it: but it was such a smal] amount we were will- 
ing to pay that difference, if satisfactory. to save 
him money. There was at least a quarter to one- 
third he got paid for that never had heen hauled 
to the job. | 

We had sections on that job which they called the 
turning apron. where the B 29 turned, consisting 
of 3 ineh plant mix with 6 inch erusher or base, 
to be removed. and the ditt to be exeavated for 
every runway. On these places we favored the 
erusher run as much as possible. and used it in 
connection with the 2 ineh stamlized base, for 
which Duque &€ Frazzini got paid. 

Q. Mr. Basich, the change in the measurement 
from water level to cubie vards was at the sugges- 
tion of Duque & Frazzini? A. That's Right. 

Q. It was for their benefit? 

A. It was for their benefit. 

Q. In veur opinien were they given a greater 
amount or quantity by computing on a eubie yard 
basis than a water level basis? A. Yes. 

Mr. Monteleone: That is all. 


Cross-Examination 
By Mr. MeGall: 

Q. Mr. Basich. vou say that vou had a conver- 
sation with Mr. Frazzini regarding the change in 
the caleulation of this material mentioned in Article 
XNIIT. Item 11 of the subcontract? 

A. Yes. 


Basich Brothers Construction Co. 431 


(Testimony of Nickola L. Basich.) 

Q. When did that conversation take place? 

A. Qh, that conversation took place around the 
23rd or 22nd; something like that; of February. 

Q. The 23rd or 22nd of February, 1945? 

A. Yes. 

Q. And he agreed with you that he would change 
the calculation, and instead of paying on water 
truck level, that you would pay on another basis? 

A. He wants me to save two men every day on 
the plant, plus one man making the trucks. 

Q. So to that extent you and Mr. Frazzini 
changed the subcontract? 

A. Well, we didn’t change the subcontract at 
all; the measurements only. 

Q. Did you ever keep a record of the truck 
loads as required by the subcontract, after that? 

A. I don’t know if they did or not. 

Q. Now, Mr. Duque, if Mr. Frazzini stated in 
his deposition, reading from page 111, at line 23: 

“Q. Well, IN show vou the schedule 39 
in this Bill of Particulars, copy of which coun- 
sel has before him, and ask vou if vou had any 
contract or agreements with Basich Brothers 
after the signing of your subcontract to eal- 
culate that material otherwise than is stated 
in the subcontract. 

“A. No, not to my knowledge. 

“@. You will note the subcontract calls for 
40 cents a eubie vard and the material has 
been added up im square vards, and then re- 


432 Glens Falls Indemnity Co. vs. 


(Testimony of Nickola L. Basich.) 
duced to cubic vards. Do you know on what 
basis, what reason that was done? 
“AS Woah dome” 


If My. Frazzini testified to that, do you still 
contend that vou did have such an agreement with 
him as vou mentioned? A. Surely. 

The Court: Well, the fact remains, however, 
whether vou did have an agreement, or did not, the 
settlement was made upon that basis? 

The Witness: <A different basis, yes. 

Q. (By Mr. McCall): Then, Mr. Basich, you 
said something about Mr. Bray told you that Duque 
& Frazzini needed $20,000.00 to continue. I did 
not understand all vou said about that. Will you 
tell me again? 

A. Myr. Bray told me that they needed $20,000.00 
to continue with the work and produce the material. 

Q. When did this conversation take place? 

The first part of May. 

Where was it? 

At Tneson, at the Base. 

Who was present? 

I don’t know if anybody was present. 

Did he tell vou how he caleulated Duque & 
Frazzini needed $20,000.00? 

A. Duque & Frazzini told him that they needed 
$20,000.00. 

@. That is what he told you? 

A. That is what he said. He told me that they 
owed $10,000.00 to the bank in Reno. 


[ot ie
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